Types of Commercial Leases

1. Capital Lease

a. Personal (Chattel – Section 38) and titled equipment
b. Nominal or fixed purchase option due at lease end
c. Any tax benefits belong to lessee (customer)

2. Tax Lease

a. Personal (Chattel – Section 38) and titled equipment
b. Residual/purchase option of between 10% - 25%
c. Any tax benefits belong to lessor (Mid America)

3. TRAC Lease (Terminal Rental Adjustment Clause)

a. Titled vehicles only – primarily medium – heavy duty
b. Residual of generally 20% due at lease end
c. Any tax benefits belong to lessor (Mid America)