Equipment Leasing and Paying Taxes (or else…)

By | September 8, 2009

section 179 makes capital lease expenditures more advantageousThis post is about equipment finances and taxes, but it’s probably not in the way you think.

See, usually when I write about something like this, it’s about the tax advantages of leasing equipment, or maybe about leasing tax write offs, or some other issue about taxes and leasing. But not this time – this is a little more light-hearted in tone.

Ok, I get news alerts e-mailed to me on equipment financing and equipment leasing stuff… so whenever there’s a story that mentions equipment leasing or the like, I get it. Hey, what can I say… I like reading about this stuff. Usually, it’s all pretty mundane news – so and so announced the continuation of such and such program, making capital lease expenditures more advantageous to the… ok, I’ll stop before I put you to sleep.

But one I got recently made me smile. It seems a chiropractor in Georgia (the article mentioned the name, but I won’t here, as there’s no need to further publicize the guy) was sentenced to two years in jail for failure to pay taxes. Turns out, he was funneling money to dummy companies. They gave four examples of companies in the story, and you know what three of them were? They were leasing companies – “Chiro Equipment Leasing,” “Quantum Office Equipment Leasing,” and “World Travel Leasing”.

I found that pretty amusing, to be honest. On one hand, at first, I was slightly put off, thinking “jeez, why leasing… why is equipment leasing seen as a good place to “hide” money?” I guess I really had no reason to think negatively about it, but I’m proud to be in equipment leasing – and to find that someone used it as a front just gave me pause.

But then I thought about it some more, and it made sense to me. Because hey, leasing chiropractic equipment is indeed a legitimate business expense for a chiropractor, right? In fact, “equipment leasing” in general is pretty legitimate looking for any business. And, as all of my readers know, with Section 179 and such, there are definite tax advantages to leasing equipment. So I guess that he chose “equipment leasing” to make things look on the up and up must mean equipment leasing IS seen in a positive light.

But do me a favor everyone… pay the proper taxes, regardless of your business. And if you MUST fake it and hide money, do what everyone else does – file it under “entertainment expenses”.

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