Leasing, Factoring, and Government Programs 157 Service plans. Find out whether your lease comes with an on-site plan, and if so, determine its length. If the lease includes only one year of on- site service, you may need to buy a service contract for the remainder of the lease; if you do not do so, you will be responsible for all repairs after the first year. Also, be sure the contract specifies when the service will be performed (ideally, the next business day after you've notified the lessor of the problem). When a Lease Is Not a Lease Read the fine print of any lease you sign. The IRS considers some leases to be capital purchases, which means that you will not be able to deduct your monthly payments. A capital purchase has occurred if under your lease agree- ment you meet one of the following criteria: · You have a "bargain buyout" in which you can purchase the machine for a token amount at the end of the lease. · You are leasing the machine for 75 percent of its useful life. · The total amount you pay for the equipment during the period of your