Equipment Loan vs Lease Calculator
Lease the truck or buy it with an equipment loan? Compare monthly cost, ownership outcome at end of term, Section 179 tax benefits, and 5-year total — including residual value scenarios.
| Equipment Loan | |
| Loan amount | — |
| Monthly P&I | — |
| Section 179 tax benefit Y1 | — |
| Net cost after tax + ownership | — |
| Lease | |
| Total lease payments | — |
| Tax deduction (lease payments) | — |
| Buyout at end | — |
| Net cost after tax + buyout | — |
The classic equipment financing question: loan or lease? An equipment loan builds ownership and captures Section 179 tax savings in Year 1. A lease produces lower monthly cash flow and full payment deductibility but no end-of-term ownership unless you buy out. The right answer depends on cash flow priority, ownership horizon, and tax position.
Equipment Loan Advantages
Full Section 179 deduction in Year 1 (up to $1.16M for 2024, with 60% bonus depreciation phase-down). Own the equipment at end of term — capture residual value. Build equity that can be borrowed against. Lower total cost when residual value is significant.
Lease Advantages
Lower monthly cash flow (no down payment, longer effective term). Easier qualification — lessors finance more aggressively than banks. Lease payments fully deductible as operating expense. Easy upgrade path (true tax leases let you walk at end). Best for fast-depreciating equipment.
Tax Treatment (Section 179 vs Bonus)
Section 179 (loan + Operating Lease without buyout): up to $1.16M instant deduction in 2024 ($1.22M projected 2025). Bonus depreciation: 60% in 2024, 40% in 2025, 20% in 2026 (phasing out under current law). True tax lease (Operating Lease): payments deductible over lease term, no Section 179 on equipment.
Last updated May 2026. Sources: IRS Section 179, Equipment Leasing & Finance Association.