The IRS frowns upon the improper acceleration of deductions and deferral of income. IRS FASB Considerations for Equipment Financing is essential when acquiring titled equipment. When considering a purchase, it’s important to consider sales tax, use tax and property taxes.
Financing helps businesses acquire critical assets without paying upfront, preserving working capital and providing access to valuable tax savings. Choosing the right financing structure and timing can maximize deductions, reducing taxable income and improving year-end profitability. This is particularly true for Section 179, which enables businesses to deduct the full purchase price of qualifying equipment in the year purchased – even when the purchase is financed.
IRS FASB Considerations for Equipment Financing
Understanding the dos and don’ts of equipment finance is key to maximizing growth and achieving business goals. Do: Maximize tax benefits by partnering with an expert financial professional. Experts can interpret complex tax laws and ensure that financing structures and deductions such as Section 179 are utilized effectively.
Don’t: Overlook key financial factors when assessing your customers’ ability to afford your products. Assessing your customer’s credit history is vital when determining whether or not to provide vendor financing. A thorough evaluation of a customer’s credit history can help you identify unique financing needs and make more informed decisions about the equipment financing options that are most appropriate for them.
Achieve your business goals faster by providing a fast, easy, and affordable financing solution for your customers. Partnering with a vendor financing specialist can improve your customers’ purchasing experience, helping you to grow your customer base and increase sales.
