3 minute read5 Secret Tax Tips For Leasing Data Storage in 2013
By Kyle Christopher
Data storage leasing is a game-changer when it comes to pushing through your storage projects. There are several immediate bonuses to leasing storage. For starters, Congress has now extended and enhanced the Section 179 tax deduction and bonus depreciation until the end of 2013 in an effort to stimulate the economy and lower unemployment. These incentives offer many companies the opportunity to invest in hardware and quickly recover their costs.
1. $500,000 Worth of Tax Deductions
Got your attention yet? The extension of Section 179 allows tax deductions on storage purchases and leasing of both new and used hardware.
2. A High Threshold
$2,000,000 is the maximum amount that can be spent on equipment before the $500,000 is reduced. This is obviously a high threshold most businesses won’t come close to when leasing or purchasing storage hardware.
3. A $500,000 Write-Off Without Actually Spending $500,000
By leasing EMC or NetApp storage solutions, businesses may acquire and write off up to $500,000 worth of equipment without spending that amount. “How does that work?” you ask. Great question. Because you are leasing, the equipment purchase is being financed through monthly payments. So you actually get the benefit of a huge investment, without a huge investment, while dramatically lowering your CAPEX expenses.
4. Virtually All Business Automatically Qualify
Virtually all businesses that purchase, finance, or lease less than the $2M threshold will qualify for the Section 179 Deduction, under normal circumstances. Of course, you should always consult with your tax advisor when considering your specific circumstances. Remember, the goal is to stimulate the economy, so the odds of securing the deduction are in your favor.
5. Leasing Is Easier to Push Through Procurement
If you’ve had a hard time pushing through a purchase for a storage project, and a $500,000 tax deduction isn’t convincing enough, the word “leasing” is, by definition, less intimidating than the word “purchasing.” So if your procurement folks aren’t sold on the idea of a purchase, perhaps you can offer the alternative to lease your data storage solution. This also leaves you the opportunity to purchase later once you can show the value of a particular storage solution you currently have on lease.
How can we help you internally sell your next data storage project? Let us talk you through your purchasing or leasing options to see if we can help you find tax deductions, push through projects and save on your CAPEX budget. You can find more information about us on OUR CONTACT PAGE.