Equipment Leasing Blog

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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 The idea that good companies willing to invest in their future is thwarted at the banking door is largely due to the outdated underwriting requirements.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

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