First, forget traditional leasing. Ads on the backs of the consumer computer magazines touting “only $50/month” for leases on the laptop configuration of your dreams are often sucker leases — high interest leases that are cash cows for the vendors. Or the ads will tout zero percent leasing, while the fine print below notes the great rate is only for well-qualified buyers, whatever that means.
Banks are often inept at technology leasing. Many offer leases with $1.00 end-of-term buyout provisions. If you are audited, such leases are likely to be re-classified by the IRS as installment purchases. You would then be subject to penalties as well as having to reclassify the acquisition as a capitalized asset purchase.
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