Customer Tax Savings Opportunity

Save Money through IT Financing

With the recent passing of the Economic Stimulus Act, you may be eligible to expense $250,000 or more of equipment financed in 2008.


Why Investing in IT Infrastructure Makes Sense

When financing new equipment and other tangible products, mid-market customers typically prefer to deduct a substantial amount in a single tax year, rather than a little at a time over a number of years.  Under Section 179 of the US Internal Revenue Code, the law increases the amount a business can expense on qualified equipment up to $250,000. This incentive is in place for mid-market customers whose equipment is in service between December 31, 2007 and January 1, 2009 and the deduction phases out when a business purchases more than $800,000 in one year. (Companies cannot write off more than their taxable income.)

2008 Bonus Depreciation
In addition to the regular first-year depreciation, business owners can take advantage of a bonus Depreciation of 50% on qualified equipment.

Benefits of a Non-Tax, Capital Lease or Finance Agreement
The benefit of a Non-Tax, Capital Lease, or Finance Agreement is that it can take advantage of Section 179 of the US Internal Revenue Code: expense up to $250,000 if the equipment is in service in 2008. In addition, customers may depreciate any excess as determined by the depreciation schedule for that asset.  Examples of Non-Tax or Capital leases include a $1 Buyout, Equipment Finance Agreement (EFA), and a 10% Purchase Upon Termination (PUT) lease.

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The above example represents a hypothetical tax scenario and may not apply to your business. The tax treatment shown reflects only transactions deemed to reflect a purchase of the equipment or a capitalized lease purchase transaction. You are advised to consult your tax advisor for any decisions concerning acquisition of equipment or software. All lease requests are subject to credit approval.      

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