Heavy Equipment Financing

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If you are looking to buy heavy equipment for your business there are likely a number of questions that you have. A central one pertains to whether a business should buy or lease it.

Should you just lease the equipment?

This way you can reduce the chances that you will have to pay for repairs. Also, every few years you will have the latest and greatest machinery.

Or, should you finance it?

Tax Deductions & Financing

Did you know that your company can lease equipment and still take full advantage of the certain tax deductions?

Financing is generally a superior option for many companies. The major reason for this is ownership. When you finance, the money you spend is in an investment. Once paid off, equipment can become one of a company's most valuable assets. On the other hand, when you lease the money you spend only gets returned based on the current profits its generating.

Moreover, most heavy equipment is unlike modern technological devices which see a great depreciation in value over time. That is, obsolescence is low for much of the heavy equipment on the market because large advancements do not happen often. (Note: This assumes proper upkeep of the equipment.)

Lastly, when a company buys heavy machinery and tools, in many places, it can deduct up to $24,000. This is for the first year. This can cut the effective cost of making a series of heavy equipment acquisitions significantly.

Taken together, if you are on the line of whether to lease or finance heavy equipment, financing is likely the smarter choice.

The following resources may also be helpful to you when you are researching your next heavy equipment purchase.

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