Is it better to lease or buy restaurant equipment?
Buying (cash or a loan) is usually cheaper over the life of durable equipment you'll keep for years, and you own the asset. Leasing preserves cash, bundles service on some agreements, and makes sense for equipment you'll replace often or when cash is tight. This tool compares the net-of-tax cost of each so you can see the gap for your numbers.
What's the difference between a $1-buyout lease and an FMV lease?
A $1-buyout (capital) lease is essentially a loan — you own the equipment for $1 at the end, and payments build equity. A fair-market-value (FMV/operating) lease has lower payments but you return the equipment or buy it at market value at the end; payments are typically fully deductible as an expense. They're taxed differently, so confirm treatment with your accountant.
Are lease payments tax deductible?
Operating (FMV) lease payments are generally deductible as a business expense in the year paid. A purchase (cash or loan, or a $1-buyout lease) is instead typically deducted via Section 179 / depreciation. This calculator lets you apply a tax rate to approximate the after-tax cost of each path — it is not tax advice.
Does this calculator account for owning the equipment at the end?
It compares total out-of-pocket and after-tax cost over the term. A purchase leaves you owning an asset with residual value (not credited here), while an FMV lease does not — so if you'll keep the equipment for many years, buying usually looks even better than the raw numbers suggest.