Question 1

What are current equipment financing rates in 2026?

Accepted Answer

Equipment financing rates in 2026: bank loans 4–8% APR for creditworthy borrowers, SBA 504 loans 5–7% for real property and heavy equipment, equipment leases 6–12% effective rate, and online fintech lenders 10–30% APR for fast-approval situations. Rates depend on credit score, equipment type, and loan term.

Question 2

Should I lease or buy equipment?

Accepted Answer

Buy if: you plan to use equipment 5+ years, it holds residual value, and you want to take the Section 179 deduction. Lease if: technology changes rapidly (IT, medical equipment), you want lower monthly payments, or you need to preserve working capital. Equipment loans (not leases) let you take Section 179; operating leases do not.

Question 3

What is the Section 179 deduction for equipment in 2026?

Accepted Answer

The 2026 Section 179 deduction limit is $1,220,000, with a phase-out beginning at $3,050,000 in total equipment purchases. Bonus depreciation is 40% in 2026 (down from 60% in 2024). Combined, a business purchasing $200,000 of equipment could deduct the full amount in year one, eliminating $40,000–$70,000 in taxes depending on bracket.

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