| Types of Leases
Fair Market Value
* Provides lowest possible payments
* Allows you to deduct 100% of the payment from your taxable income
* Gives you the option of purchasing the equipment at the end of
the term at fair market value or returning the equipment (There
is no obligation to purchase the equipment at the end of the term)
* Offers the best option if you plan to use the equipment or software
for 3 years or less
10% Purchase Option
* Provides lower payments than the $1 buyout option
* Allows you to deduct 100% of the payment from your taxable income
in most cases
* Gives you the option of purchasing the equipment for 10% of the
original funding amount or returning the equipment (There is no
obligation to purchase the equipment at the end of the term)
* Offers end of lease flexibility and a pre-determined purchase
price
$1 or $101 Purchase Option
* Transfers ownership of the equipment to you at the end of the
lease term
* Requires the lease payments to be deducted as a capital expense
* Protects cash reserves by simplifying budgeting with fixed monthly
payments
* Offers best option if you plan to use the equipment for more than
5 years
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