The new tax law's restoration of EBITDA-based interest deduction calculations quietly creates one of the most significant opportunities for equipment sellers: customers who were previously constrained by debt capacity limitations can now support substantially larger equipment financing. For sellers who understand how to identify and leverage these opportunities, this translates to larger deals and stronger customer relationships.
Not every customer benefits equally from enhanced interest deduction capacity. The businesses that benefit most are capital-intensive operations with significant depreciation expenses – often your best equipment customers.
Identifying Customers With Expanded Capacity
Manufacturing businesses
Heavy machinery operations with substantial depreciation
Companies with multiple facilities and equipment assets
Businesses planning production line expansions or modernization
Example compound benefit scenario
Production equipment: $3 million (100% bonus depreciation)
R&D equipment: $800,000 (immediate R&D expensing)
Facility improvements: $5 million (QPP qualification)
Total immediate deductions: $8.8 million
Tax savings (37% bracket): $3.26 million
Net investment: $5.54 million for $8.8 million in improvements
Identifying enhanced interest capacity opportunities requires specific questioning techniques that go beyond traditional credit assessment.
Customer Discovery Questions
Facility and equipment coordination: Help customers coordinate equipment purchases with facility improvements or expansions, leveraging enhanced debt capacity for comprehensive solutions.
Customers may not understand their improved borrowing capacity or how it affects equipment decisions. Your role is education and opportunity identification.
The enhanced capacity conversation framework
Presentation Techniques for Enhanced Capacity
QPP qualification requirements
Construction timeline: Begin between 1/19/25 and 1/1/29, complete by 12/31/30
Activity requirements: Significant assembly, processing, or production activities
Location requirement: Conducted within the U.S.
Facility scope: Manufacturing facilities and related production equipment
Depreciation and asset assessment
"How much equipment depreciation do you typically show on your tax returns?"
"What's the approximate value of equipment on your balance sheet?"
"Do you track depreciation separately for tax and accounting purposes?"
Example transformation:
Previous approach: $300,000 excavator sold individually
Enhanced capacity approach: $800,000 package including excavator, trucks, compactors, and accessories
Customer benefit: Full interest deductibility on larger financing package
QPP opportunity indicators
Facility expansion plans or new construction projects
Production line additions requiring building modifications
Manufacturing reshoring or domestic production expansion
Facility modernization or automation projects
Example QPP integration
Customer need: New manufacturing facility for automotive parts
QPP opportunity: $8 million facility construction
Equipment package: $2.5 million production equipment
Coordination strategy: Time equipment delivery with facility completion
Combined benefits: $10.5 million immediate deductions, $3.89 million tax savings
1. Assess current situation
"Based on what you're telling me about your current equipment depreciation, it sounds like you might have significantly more borrowing capacity than you realize under the new tax law changes."
2. Explain the enhancement
"When we coordinate all these benefits, your $4 million equipment investment could generate $1.48 million in immediate tax savings, making your true cost $2.52 million."
3. Quantify the opportunity
"This enhanced capacity could enable the comprehensive equipment package we discussed, rather than having to phase purchases over multiple years due to financing limitations."
4. Connect to equipment opportunities
Helping customers understand their enhanced capacity requires moving beyond traditional equipment sales education to business financial strategy.
Advanced Customer Education Strategies
Simple calculators showing enhanced interest deduction capacity
Worksheets helping customers identify depreciation impacts
Comparison charts showing previous vs. current borrowing capacity
Industry-specific examples
Manufacturing case studies showing enhanced capacity utilization
Construction company scenarios with fleet expansion strategies
Healthcare practice examples of equipment expansion financing
Enhanced interest deduction capacity creates opportunities for deeper partnerships with equipment lenders who understand tax coordination.
Partnership Strategies With Lenders
Lender partnership benefits
Joint customer education on enhanced borrowing capacity
Larger deal development through expanded debt capacity
Customer solutions that coordinate tax benefits with financing strategies
Identify tax-savvy lenders who understand new tax law implications
Educate financing partners on customer opportunities
Develop joint presentation capabilities for complex customer situations
Create referral systems that benefit all parties
Partnership development approach
"I'd like to bring in our financing partner who specializes in equipment financing under the new tax law changes. They can help us model exactly how much additional capacity you have and structure financing that maximizes your benefits."
Customer consultation coordination
Enhanced interest deduction capacity creates opportunities for deeper, more strategic customer relationships.
Customer Relationship Enhancement
Strategic partnership development
Annual capacity assessment and planning sessions
Multi-year equipment strategy development
Coordination with customer financial and tax advisors
Financial planning collaboration
Regular review of customer depreciation and capacity changes
Early identification of expansion opportunities enabled by enhanced capacity
Strategic timing recommendations for major equipment investments
Proactive opportunity identification
Business financial strategy consultation beyond equipment sales
Tax planning coordination and professional referral services
Comprehensive equipment lifecycle management programs
Value-added service expansion
Prime candidates for expanded capacity
Construction companies
Fleet-heavy operations with significant equipment depreciation
Companies with seasonal financing needs
Contractors planning equipment expansion or replacement
Transportation and logistics
Commercial vehicle fleets with ongoing depreciation
Companies with warehouse and distribution equipment
Businesses planning fleet expansion or modernization
Healthcare practices
Practices with substantial medical equipment investments
Multi-location operations with equipment across facilities
Practices planning expansion or technology upgrades
Current debt and interest situation
"Have you been limited in equipment financing because of debt capacity concerns?"
"Do you typically finance equipment or pay cash due to interest limitations?"
"Has your accountant ever mentioned business interest limitations affecting your financing options?"
Equipment financing history
"What equipment investments have you been postponing due to financing constraints?"
"Are there expansion opportunities you haven't pursued due to debt capacity concerns?"
"How would additional borrowing capacity change your equipment planning?"
Growth planning assessment
Enhanced interest deduction capacity enables equipment sellers to develop significantly larger deals with existing and prospective customers.
Larger Deal Development Opportunities
Deal expansion strategies
Multi-equipment bundling: Instead of selling individual pieces of equipment over time, develop comprehensive equipment packages that customers can now finance without hitting interest deduction limits.
Multi-year equipment programs: Develop relationship-based equipment programs that utilize enhanced capacity for ongoing equipment needs rather than transactional single purchases.
"The recent tax law changes allow businesses to add back depreciation when calculating interest deduction limits. For a business like yours with substantial equipment depreciation, this could mean hundreds of thousands in additional borrowing capacity."
Capacity assessment tools
Educational content development
Professional coordination materials
Documentation for customer tax advisors explaining enhanced capacity
Financial projection templates incorporating enhanced deductions
Integration guides for tax and financing planning
The enhanced interest deduction provisions run through 2029, creating timing considerations for customer planning.
Timing and Urgency Creation
"The enhanced interest deduction rules run through 2029, giving you a clear four-year window to take advantage of expanded borrowing capacity. Let's develop a comprehensive equipment strategy that maximizes this opportunity."
Multi-year planning positioning
"Since you're already planning equipment purchases, this might be the optimal time to consider a more comprehensive approach that takes advantage of your enhanced borrowing capacity."
Capacity optimization timing
"While your competitors are still thinking about equipment purchases one piece at a time, you can now finance comprehensive solutions that give you operational advantages."
Competitive advantage framing
Production line modernization enabled by enhanced capacity
Multi-facility equipment programs supported by expanded borrowing
Technology integration projects combining multiple equipment types
Manufacturing customers
Fleet expansion strategies utilizing full capacity
Seasonal financing programs that accommodate cyclical cash flow
Equipment replacement cycles optimized for tax and operational benefits
Construction customers
Practice expansion equipment packages
Technology upgrade programs for multiple locations
Coordination with facility improvement and equipment needs
Healthcare customers
Different industries present unique opportunities for leveraging enhanced interest deduction capacity.
Industry-Specific Strategies
Track your success in leveraging enhanced interest deduction opportunities and build expertise that benefits customers.
Measuring Success and Building Expertise
Average deal size increase in target customer segments
Customer financing approval rates for larger packages
Multi-equipment package penetration rates
Customer satisfaction with comprehensive solutions
Success metrics
Build understanding of customer depreciation patterns
Develop facility with financial analysis and capacity assessment
Create relationships with tax professionals and specialized lenders
Learn industry-specific applications and opportunities
Expertise development
Implementation Action Steps
Identify current customers with significant equipment depreciation who might benefit from enhanced capacity
Develop assessment tools to help customers understand their improved borrowing capacity
Build partnerships with lenders who understand enhanced interest deduction coordination
Train sales teams on capacity assessment and larger deal development techniques
Create customer education materials specific to enhanced interest deduction benefits
Become known as the equipment provider who helps customers maximize financing capacity
Develop reputation for comprehensive solutions rather than transactional sales
Build long-term customer relationships based on strategic financial planning
Market positioning opportunities
Larger average deal sizes through enhanced customer capacity
Stronger customer loyalty through comprehensive solution provision
Market expansion opportunities with previously constrained customers
Business growth strategies
Enhanced interest deduction capacity represents a fundamental shift in equipment financing that creates lasting competitive advantages for sellers who master its application.
Long-Term Strategic Implications
The restoration of EBITDA-based interest deductions creates a unique window where many customers have significantly more borrowing capacity than they realize. Equipment sellers who identify these opportunities and help customers leverage enhanced capacity will build stronger relationships while closing larger, more profitable deals.
The key is moving beyond traditional equipment sales approaches to become strategic advisors who help customers optimize their financial capacity for equipment investment. This requires new skills and partnerships, but the rewards – both for sellers and customers – justify the investment in enhanced capabilities.
LEAF specializes in equipment financing that coordinates with enhanced interest deduction capacity and other benefits of the new tax law. We partner with equipment sellers to identify customer opportunities and structure financing solutions that maximize both operational and tax advantages.
"Are you currently hitting any limitations on interest deductions?"
"How much annual interest expense does your business typically have?"
"Have you ever been told you're at your borrowing capacity for tax reasons?"