TRAC Lease

A TRAC (Terminal Rental Adjustment Clause) lease is a type of true lease that is generally used for vehicles such as trucks, tractors, trailers and buses. A TRAC Lease can be used to get lower, true-tax oriented lease rates and still have a fixed buyout at the end of term.

• A TRAC Lease must meet the IRS requirements of a true lease
• Cannot be structured as a leveraged lease

Advantages of a TRAC Lease

• Offers low fixed lease rates  and the benefit of a fixed buyout at the end of the lease.
• Lessee has upside potential if the equipment is worth more than previously determined.