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Thursday, October 28, 2010

The Small Business Jobs Act of 2010 and Section 179

With intentions of bolstering the economy with new job opportunities, President Obama recently signed the Small Business Jobs Act of 2010 into law. The administration hopes that by helping businesses to swiftly recover the capital loss from new equipment expenditures, these businesses will have the funds to grow and provide jobs.

Many business owners who acquire equipment for their business typically prefer to deduct the cost in a single tax year, as opposed to deducting smaller amounts over a number of years. The deduction that makes this possible is referred to as a Section 179 deduction. Under this tax provision, if your business spends less than $2,000,000 a year on qualified equipment, you can write off up to $500,000 in 2010 and 2011. The stipulations of this deduction were designed for small businesses. To ensure small businesses receive these benefits, the $500,000 deduction phases out when a business purchases more than $2,000,000 in one year.

Some additional benefits of the Small Business Jobs Act of 2010 include:


  • Section 179 expensing will increase to $500,000 for qualified property.

  • Software will continue to be eligible for full Section 179 expensing.

  • Leasehold improvements, restaurant property and retail property may be expensed up to $250,000.

  • Certain passenger automobiles have an increased depreciation of $8,000 in the first year. This means that automobiles are allowed $11,060 and vans and small trucks are allowed $11,160.

  • Companies who offered their employees cell phones as a fringe benefit are now able to deduct the costs of those phones when they are used for valid business purpose.

  • Taxpayers will have access to their Section 179 election without the permission of the IRS.

  • The Small Business Jobs Act of 2010 extends 50% first year bonus depreciation and AMT depreciation on new property through the end of the year. This extension in retroactive through January 2010.

The Section 179 deduction can be made on Form 4562 for the tax year the property was placed in service. Section 179 property is property that you acquire by purchase for use in the active conduct of your business. Business owners can expense the total cost of property for any tax year, but it cannot exceed the total amount of taxable income during that tax year. Small businesses can make the most of Section 179 through Non-Tax/Capital Leases. To find out your tax savings, and the true cost of your equipment acquisition, use our Tax Savings Lease Calculator. As a reminder, to take advantage of the 2010 and 2011 tax incentives, your business equipment must be put in use by year-end. Each company should contact their tax adviser to learn more about how you can make these deductions work for your company.

The Small Business Jobs Act of 2010 allows businesses to compete and grow. Contact your tax adviser or Tiger Leasing for more information on Section 179, equipment leasing, and personalized leasing options for your company.

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posted by Tiger Leasing @ 1:50 PM 0 Comments Links to this post

Wednesday, October 20, 2010

Bank Loans Remain Elusive, Tax Benefits Improve

A recent article in Crain’s New York tells a dismal story for small businesses trying to grow their companies. The idea that good companies willing to invest in their future is thwarted at the banking door is largely due to the outdated underwriting requirements.

The Crain’s article goes on to share a recent survey by Pepperdine University, which found that access to capital was the No. 1 business issue for half of private companies nationwide.

As Tiger Leasing is a New York City based business; we were frustrated to see that "both the total volume and total value of small business lending in New York State tumbled by nearly half between 2006 and 2009."

Credit cards are becoming more costly with the raising of the interest rates, new fees and larger minimum requirements; venture capitalists have pulled back from the funding arena; and banks are stuck in antiquated underwriting processes.

Companies need access to capital in order to grow their companies. Taking the initiatives to keep up with the changing business environment should not eat into a company’s reserves. Managing cash flow is essential for both sustainability and growth.

Equipment leasing is often an overlooked yet sound economic solution. Leasing equipment needed to improve or grow your business might be the best solution, especially now with the recent changes in the tax law. Legislation recently approved the change that allows small businesses that spend less than $2 million a year on qualified equipment to write off up to $500,000 in their 2010 taxes.

Financial considerations for a company to lease over purchase are:

  • Preservation of capital

  • Preservation of cash flow

  • Preservation of credit lines

  • Tax deductions

Why not explore the tax benefits you would receive on an equipment lease? Use our Tax Savings Lease Calculator, which has recently been updated to reflect the new legislation, to find out the tax benefits of your new equipment acquisition.

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posted by Tiger Leasing @ 9:58 AM 0 Comments Links to this post

Tuesday, October 19, 2010

Improve Your Customer Service to Maintain a Healthy Bottom Line

As a business owner, you know that exceptional customer service breeds success. A productive consumer relationship translates to a mutual trust, which cultivates brand loyalty and, in turn, a healthy profit margin.

The healthy earnings outlook associated with good customer service is the reason many businesses are investing in methods to improve their customer relations tactics. However, according to McKinsey & Company , a mere 10 percent who are making the effort are seeing satisfactory results.

To avoid squandering your investment dollars, remember that good customer service isn't dependent on the lowest price tags or the length of your customer relations handbook. Rather, it's the little things that can yield the most valued responses.

The personal touch matters.

No matter the industry in which you conduct business, some of your clients may get entangled in an emotionally charged situation, either negative or positive, involving your product or service. By taking advantage of the emotional nature of the transaction and handling the situation correctly, you have the opportunity to create bond. A positive emotional experience for the customer, as opposed to a routine incident, will more often lead to a higher quantity and quality of sales. This is the same concept behind pairing automated customer service solutions with human interaction.

While technologically advanced solutions mitigate human error, these methods lack the personal touch necessary to foster brand loyalty. If you have the resources to do so, unite them both to achieve maximum results.

Give your customers a voice.

By granting your customers the opportunity to submit feedback based on their experiences, your business will benefit in a variety of ways:


  • Your customers who feel valued, meaning they are more apt to be brand loyal

  • The feedback you receive will provide insight into products and services that are doing well even as it pinpoints areas in need of improvement

  • Comments may spark ideas for the development of new products or services

While comment cards and call-in responses are still effective, be sure your harnessing the feedback opportunities online. Look into rating and review applications you can put directly on your Website and request praise or criticism online through social media platforms. Regardless of the methods you use, reassure your customers that you're taking their comments and suggestions sincerely.

Prepare your staff.

Unless you work 24 hours a day, 7 days a week, members of your staff will likely need to handle a customer's praise or complaints solo. Because good customer service skills aren't generally an inherent trait, your staff must be adequately educated on the proper procedures when interacting with a customer. If you're not sure you're up for the task of training, there are multiple programs available to help out.

Know how humans work.

Go beyond simply understanding what your customers want and need. If you're brave, you'll dig deeper to comprehend the more subtle reasons behind your customers' satisfaction or displeasure. An article in McKinsey Quarterly addresses how business owners can use the study of behavioral science to their advantage when applied to customer service. Based on these findings, by altering the manner in which you provide customer service, you can achieve higher incidences of positive reactions. When communicating with customers:

  • Lump less comfortable obligations together early-on while scattering the most pleasant topics throughout the experience.

  • Save the best for last. Customers respond more positively when an experience ends on a high note as opposed to one that starts strong and fizzles at the finish.

  • Give multiple options. Customers who get to choose are more likely to perceive positive results.

  • Promote habits and don't break them. People in general, some more than others, live and die by rituals because they're comforting. Try not to impede on established habits.

Tailor your program to your customers.

Despite the research, you know your own customers best. While exploring gainful customer service tactics, don't overlook the facts you already know about your audience. Understanding your audience and your business allows you to tailor your customer service policies to them. Take care of your business by taking care of your customers.

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posted by Tiger Leasing @ 2:52 PM 0 Comments Links to this post

Wednesday, October 13, 2010

Equipment Leasing for Heavy Machinery

As the American Recovery and Reinvestment Act of 2009 continues to dole out funds in hopes of bolstering the economy, additional infrastructure jobs are up for grabs. Those in industries operating heavy equipment should take note that these opportunities are creating a necessity for additional or upgraded equipment. However, resist the urge to run headlong into a purchase without understanding the options on the table.

There are two main options when acquiring new heavy equipment: leasing or purchasing. To determine which option will maximize benefits while minimizing risk, you must evaluate your business's current equipment needs in conjunction with its present financial situation. However, don't omit your predictions for the future state of these areas when assessing the pros and cons of purchasing or buying equipment. Draft a business overview that includes:

  • The ways in which your business will be more competitive with additional or upgraded equipment.

  • The state of your capital: the funds you have available now and in the future.

  • Your current and potential equipment needs.

  • Changing technologies: how often does your equipment need to be upgraded to ensure your business remains viable?

Many leasing companies offer free consulting services that will help you answer these important leasing questions and help you select the customized equipment leasing program that is most advantageous for your needs. Generally, businesses that require up-to-date equipment so as to stay competitive will lean toward leasing because of the options to upgrade. In addition, businesses that may have the cash flow to fund heavy equipment upfront will opt for a leasing program in hopes of conserving their working capital and credit lines while benefiting significant tax savings.

When basing your decision to lease or purchase your equipment, consider the cost per month rather than deciding based upon the loan interest rate or lease rate. By relying on a simple rate-to-rate comparison, you're not taking into consideration that lease pricing is configured based on the precept that the piece of equipment has residual value following the term of the lease.

Because of the numerous benefits of equipment leasing versus buying, 8 out of 10 business owners utilize leasing options when acquiring heavy machinery including:

  • Construction equipment: bulldozers, backhoes, excavators, surveying equipment and trucks or tractors.

  • Warehousing equipment: forklifts, manual lifts, power movers and conveyers.

  • Industrial and manufacturing equipment: grinders, lathes, material handling machines and welding and molding equipment.

  • office equipment: copiers, furniture, labeling and postage machines and embossers.

Additional Information can be found here:


http://www.lessors.com/news10/allnews-0929d.html
http://www.recovery.gov/Pages/home.aspx
http://grounds-mag.com/mag/grounds_maintenance_purchasing_power/
http://www.elfaonline.org/ind/research/MLFI/0810.cfm

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posted by Tiger Leasing @ 3:58 PM 0 Comments Links to this post