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Lease -VS- Finance After-tax Impact

In an effort to provide for you the most accurate program we at National Equipment Leasing have provided this comparison so you may have data to make an intelligent choice. NOTE: We are not tax consultants, please check with your accountant before using these formulas.

Example:

Equipment cost: $10,000

Bank lending rate: 8.75%

MACRS equipment life: 7 years

Lease & Finace term: 36 months

Bank Finance

National Equipment Lease

Payment: $316.84

Corporate Tax Rate: 38%

Depreciation per yr.: $1,44.57

$1,448.57 / 12 = $119.04 per mo.

$39.01 + $119.04 = $158.05 tax deduction

$158.05 / 38% tax rate = $60.05 tax credit

$316.84 - $60.05 =

Payment: 317.42

corporate tax rate: 38%

$317.42 X 38% = $120.61 tax credit

$317.42 - $120.61 =

After tax payment of $196.81

Total of payments after tax = $7,085.16

$7,085.16 + $1,000 lease end buyout

Total including buyout $8,085.16

After tax payment of
$256.79

Total cost after tax =
$9,244.44

After tax payment of
$196.71

Total cost after tax =
$8,085.16

Which would you rather pay?

 

We are located:
7215 E. 21st. Street - Suite F
Indianapolis, IN 46219
Phone: (317) 352.9797 - Toll Free: (888) 613.9797 - Fax: (317) 352.9707

Email:
mail@nationalleasingco.com

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