Leasing is a financial method used by businesses to obtain equipment with little capital investment.
It is a commitment by the Leasing
Company for a guaranteed payment amount over a period of years that
cannot be raised.
There are numerous types of leases available. Two of the most popular are:
A "True Lease" has set lease payments with a 'fair market value'
or some other purchase option at the end of the lease term.
You as the Lessee, are able to expense 100% of the Lease
payments for income tax purposes.
A "Finance Lease" has set payments for a given length of time
with a $1 or 'minimal' purchase option at the end of the lease
period. With this product you actually own the equipment and
for tax purposes, you take the depreciation and interest expense
Profits are generated from using the equipment, not from owning it.
Some things never change, like the reason companies Lease equipment rather
than own equipment.