Cash Purchase

If your business is heavily funded with a large savings account, you can purchase the vehicles outright. However, this option is not necessarily the wisest choice. The IRS doesn't allow you to deduct your cash purchase as a business expense in the same year as the purchase. You will have to depreciate the expense over several years.

Finance Option

A second option would be to provide a sizable down payment and finance the balance over several years. Your final cost at the dealership will include sales tax for the entire purchase and added to your payment amount plus interest on the loan. This option is ok for many but the larger down payment means less buying leverage.

Lease Your Fleet

A third option, used by many business professionals, is to lease your business vehicles through a fleet vehicle leasing company. With this option your initial outright expenses are lower, allowing for more buying leverage. In addition, lease payments are lower than purchasing and you pay sales tax only on each monthly payment.

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Another advantage of leasing is you won't be locked into your vehicles after the warranty has expired. You can simply turn in your leased vehicles to the leasing company and lease new ones. Talk to your leasing agent to see if leasing your fleet vehicles is the right choice for you and your business.