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Equipment Lease Agreement Template

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Equipment Lease Agreement Template

Updated October 04, 2023

An equipment lease agreement is between a lessor, the owner of the equipment, and a lessee who agrees to pay rent for the equipment to use for a specified time period. An equipment lease can be structured with a start and end date or on a month-to-month basis. Depending on the agreement, the lessee may be able to make modifications or adjustments to the equipment as long as it does not affect its value.

Table of Contents

Types of Equipment (11)

  • Appliances;
  • Electronics;
  • Event/Party furniture;
  • DJ equipment;
  • Furniture;
  • Gym equipment;
  • Heavy machinery;
  • Medical equipment;
  • Power tools;
  • Vehicles; and
  • Any other personal property.

Equipment Rental Tax Laws

State Personal Property Vehicles  Source
 Alabama Linens/Garments 2%; all other property is levied 4% 1.5%* Alabama Dept. of Revenue
 Alaska None Passenger vehicles are 10% and recreational vehicles are 3%. Alaska Dept. of Revenue
 Arizona Transaction Privilege Tax (TPT) 6.6% plus county fees* Arizona Dept. of Revenue
 Arkansas 1% levied in addition to gross receipts tax* 10%* Arkansas Dept. of Finance and Administration
 California 7.25% (excluding motion picture films and tapes, linen supplies, and mobile transportation equipment) None* California Dept. of Tax and Fee Administration
 Colorado None for rental durations lasting 3 years or less $2.00/per day plus local surcharges* Colo. Rev. Stat. § 43-4-804(1)(b)(I)(A) 
 Connecticut 6.35% 9.35% for rentals of 30 consecutive days or less, plus a $1.00/per day surcharge* Connecticut Dept. of Revenue
 Delaware 1.9914% (excluding household furnishings and medical equipment) 1.9914% Del. Code Ann. tit. 30 §4302
 Florida 6% on taxable personal property 6% when rented for a period of 12 months or less plus $2.00/ per day surcharges* FL Stat § 212.05
 Georgia None None* N/A
 Hawaii 4% plus applicable county surcharges  $5.00/per day* Hawaii Dept. of Taxation;

Hawaii Rev. Stat.  §18-251-2

 Idaho 6% (excluding fully operated equipment rentals) None* Idaho State Tax Commission
 Illinois 6.25% 5%  

35 ILCS 155/3

 Indiana 7% (excluding certain motion picture rentals) 4%* IN Code § 6-2.5-4-10;

Indiana Dept. of Revenue

 Iowa 6% 5% plus local surcharges* Iowa Dept. of Revenue
 Kansas 6.5% plus any local taxes (see chart for all exempt property) 3.5%* Kansas Dept. of Revenue
 Kentucky 6% 6% “You Drive It” tax 103 KAR 28:051;

Kentucky Dept. of Revenue 

 Louisiana 4.45% 3%* Louisiana Dept. of Revenue
 Maine 5.5% unless exempt under ME Rev. Stat. § 1760 10% Maine Revenue Services
 Maryland 6% plus taxes levied on service charges (if any) 11.5%* MD Code Regs.;

Maryland Manual On-Line

 Massachusetts 6.25% None, but separate surcharges may apply* Massachusetts Dept. of Revenue;

MA Gen L ch 90 § 32e3/4

 Michigan 6% (payable through one of two methods) 6%* Michigan Dept. of Treasury
 Minnesota 6.875% plus applicable local taxes 9.2% tax and a 5% fee Minnesota Dept. of Revenue;

MN Stat § 297A-64

 Mississippi 7% with certain exemptions 6%* Mississippi State Tax Commission;

Mississippi Dept. of Revenue

 Missouri 4.225% (unless taxes were paid upfront in the original purchase of the rented property) 4%* 12 CSR 10-108.700

MO Rev Stat § 144.020

 Montana None 4% MT Code § 15-68-102
 Nebraska 5.5% plus applicable local taxes None NE Reg-1-018
 Nevada 4.6% plus applicable municipal taxes (payable through one of two methods) 10%* Nevada Dept. of Taxation;

NV Rev Stat § 482.313

 New Hampshire None 9% New Hampshire Dept. of Revenue Administration
 New Jersey 6.625%, but may vary depending on the duration of rental $4.00/per day* New Jersey Division of Taxation;

New Jersey Dept. of the Treasury

 New Mexico 5.125%-8.6875% depending on jurisdiction (see rates map) 5% plus $2.00/per day* New Mexico Dept. of Taxation and Revenue;

NM Stat § 7-14A-3

 New York 4% plus applicable local taxes 6%* (New York City levies an additional 5%) New York State Dept. of Taxation and Finance 
 North Carolina 4.75% plus local rates 8%* North Carolina Dept. of Revenue
 North Dakota 5% 3%* North Dakota Office of State Tax Commissioner;

ND Cent. Code § 57-39.2-03.7

 Ohio 5.75% unless an exemption applies None* Ohio Dept. of Taxation
 Oklahoma 4.5% plus any local taxes 6%* 68 O.S. § 1354;

68 OK Stat § 68-2110(A)

 Oregon None None N/A
 Pennsylvania 6% (excluding unprepared food, textbooks, computer services, and more) 2% plus $2.00/per day* Pennsylvania Dept. of Revenue;

§ 8602-A

 Rhode Island 7% 8%* Rhode Island Division of Taxation;

RI Gen L § 31-34.1-2(a) 

 South Carolina 6% 5%* South Carolina Dept. of Revenue
 South Dakota 4.5% unless an exemption applies 4.5%* plus a 1.5% tourism tax (if applicable) South Dakota Dept. of Revenue;

SD Codified L § 32-5B-20

 Tennessee 7% (unless the property is leased as a service with an operator or crew) 3%* Tennessee Dept. of Revenue
 Texas 6.25% 10% Texas Comptroller of Public Accounts
 Utah 4.85% plus local and county taxes 2.5%* Utah Dept. of Revenue;

UT Code § 59-12-1201

 Vermont 6% (agricultural equipment is exempt if used predominately for agricultural purposes) 9% Vermont Dept. of Taxes;

32 V.S.A § 8903

 Virginia 5.3% plus taxes levied on service charges 10% (comprised of 4% rental tax, 4% local tax, 2% rental fee) 23 VAC 10-210-840;

Virginia Dept. of Taxation

 Washington 6.5% (an additional B&O tax may apply at the rate of 0.484%) 5.9%* WAC 458-20-211;

Washington State Dept. of Revenue

Washington D.C. 6% 10.25* D.C. Office of the Chief Financial Officer
West Virginia 6% plus local taxes $1.00-$1.50/per day* WV Code §17A-3-4
 Wisconsin 5% 5%* WI Stat § 77.52;

Wisconsin Dept. of Revenue

 Wyoming 6% plus municipal taxes 4%* WY Stat § 39-15-103

Wyoming Dept. of Transportation

*Subject to additional state and local sales tax rates.


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What to Include (10)

  • Lessor’s (owner) name;
  • Lessee’s (renter’s) name;
  • Description of equipment;
  • Lease term;
  • Rent amount ($);
  • Security deposit;
  • Late charges;
  • Delivery responsibility;
  • Repairs and maintenance; and
  • Insurance requirements (if any).