Lease vs Cash Analyzer

Lease vs Cash Analyzer

> Caveat: this skill is one author's playbook + 5-scenario stress test. Verify state fees / CPO terms / EV credits / dealer practices against current sources before quoting numbers to a dealer or making financial decisions. Not tax, legal, or financial advice. > last_verified: 2026-05-18 (Phase 3C sub-skill split from orchestrator)

Narrow helper: lease structure math, lease-vs-cash break-even, captive lender policy lookup. Defers the full theory + worked tables to ../orchestrator/references/lease_playbook.md.

When To Use

• Buyer asks "should I lease or buy?" with a concrete vehicle + horizon
• Need to verify a dealer-quoted lease monthly is honest (MF buy-rate check)
• Need lease-end disposition / early-buyout policy for one OEM captive

> NOTE — federal §45W lease pass-through is TERMINATED (acquired after 2025-09-30, OBBBA). > The "EV buyer fails §30D AGI cap, so route to §45W lease pass-through" play is dead > for any 2026 lease. Lessor captives can no longer capture the federal $7,500 commercial > credit, so it is not available as cap cost reduction. Any "EV lease credit" a dealer > advertises in 2026 is ordinary OEM lease cash / marketing money, NOT a federal credit — > do not present it as §45W pass-through or count it as a federal incentive. See the > CRITICAL banner in ev-buyer-helper. §45W content below is HISTORICAL only.

When NOT To Use

• General OTD cash math - delegate to otd-calculator
• EV federal credit status / state rebate stacking - delegate to ev-buyer-helper first (federal §30D/§25E/§45W all terminated 2025-09-30; state rebates are the only live layer)
• Pure CPO eligibility - delegate to cpo-eligibility

Core Lease Formula

Monthly = ((CapCost - Residual) / Term) + (CapCost + Residual) * MF + Tax

Variables:

• CapCost = MSRP - CapCostReduction - LeaseCash - ManufacturerRebate
• AcquisitionFee + DealerAddOns
• Residual = MSRP * Residual% (typical 50-65% at 36 mo)
• MF = APR / 2400 (money factor; dealer can mark up buy-rate)
• Term = 24 / 36 / 39 mo most common

Money Factor Markup Detection

Always ask the dealer for the BUY-RATE money factor explicitly. If quoted MF exceeds prevailing captive buy-rate by more than 0.00040 (~ 1% APR), the dealer is marking up. Markup converts to dealer reserve, paid to dealer monthly over the lease term. Push back: "what is the buy-rate from {captive} on this vehicle and tier?" If they refuse to share, assume markup.

State Tax-on-Lease Mechanics (4 buckets)

| Bucket | States | Mechanics | |---|---|---| | Lease-friendly | NJ, FL, CA, NV, WA | Tax on monthly payment only, not on residual buyout | | Upfront-load (capitalizable) | NY, IL | Full-term tax due at signing; can be capitalized into cap cost | | Heavy upfront | TX, DC | Tax on FULL cap cost up front, regardless of residual | | Mixed | most others | Local rules vary; check state_fees.md |

For TX/DC the cash-purchase math frequently wins because the lease tax penalty front-loads ~$3,500-5,000 on a $40k vehicle.

Lease vs Buy Decision Rules

| Ownership horizon | Mileage | Lean | |---|---|---| | 5 yr | any | Buy always wins (lease compounding monthly never stops) | | any | > 15k mi/yr | Buy wins (excess-mileage penalty $0.15-0.30/mi) |

EV Lease §45W $7,500 Captured by Lessor — TERMINATED 2025-09-30 (HISTORICAL)

> No longer available. OBBBA (Public Law 119-21) terminated the federal §45W > Commercial Clean Vehicle Credit for any vehicle acquired after 2025-09-30, on the > same date as §30D / §25E. A lessor can no longer capture a federal $7,500 credit on a > 2026 EV lease, so the lease pass-through below is $0 of federal money and must NOT > be added to cap cost math or presented to a buyer as a federal incentive. Any 2026 > "EV lease credit" line is ordinary OEM lease cash / marketing money — treat it as a > negotiable OEM incentive, not a federal credit. Retained below for pre-cutoff > (acquired on/before 2025-09-30) reference only. See the CRITICAL banner in > ev-buyer-helper.

Historically, the lessor (captive finance company) captured the federal Commercial Clean Vehicle Credit, NOT the lessee. Pass-through varied by OEM (pre-cutoff only):

| OEM | Typical pass-through (HISTORICAL) | Notes | |---|---|---| | Hyundai / Kia / GM | Full $7,500 via cap cost reduction | Standard, advertised | | Toyota / Honda / Ford | $4,500 - $7,500 | Varies by trim, region, promo | | BMW / MB / Audi | $3,500 - $5,000 | Lowest pass-through |

This was historically useful for EV buyers who failed §30D AGI cap (single > $150k / MFJ > $300k) or for vehicles that failed §30D MSRP / final-assembly tests (no AGI / MSRP cap on §45W). All three credits are now terminated, so this routing no longer exists. See ../orchestrator/references/ev_buyer_playbook.md § §45W.

Captive Lender Rules

| Captive | Early buyout | Mileage purchase | Lease assumption | |---|---|---|---| | Subaru Motors Finance (SMF) | After 1 payment | $0.15/mi at signing | Allowed; $500 fee | | Toyota Financial Services (TFS) | After 6 mo | $0.15/mi | Allowed; ~$50 fee | | Honda Financial Services (HFS) | After 6 mo | $0.15/mi | Allowed | | Hyundai Capital | Day 1 (most flexible) | $0.20/mi | Allowed | | Ford Credit | After 6 mo | $0.20/mi | Allowed | | GM Financial | After 6 mo | $0.25/mi | Allowed | | Chrysler Capital | After 90 days | $0.25/mi | Allowed | | BMW Financial | After 4 payments | $0.25/mi | $500 fee |

Disposition fee at lease-end: $350-$495 typical. Often WAIVED if buyer leases or buys another vehicle from the same OEM within 30 days of return.

Acquisition fee at signing: $595-$895. Sometimes capitalizable, sometimes paid out of pocket - depends on captive. Always shown on the lease worksheet.

Lease Cash Conversion Trick

When the manufacturer offers lease cash but no cash-buyer rebate of comparable size, the lease-then-buyout path captures the lease cash. Pattern:

1. Lease the vehicle for 24 mo with manufacturer lease cash applied as cap

cost reduction.

1. Confirm captive allows early buyout from day 1 (Hyundai) or after the

minimum waiting period.

1. Exercise buyout at lease-end residual (or earlier per captive policy).
2. Net cost = (24 mo of lease payments) + (residual buyout) + (taxes per

state); compare against a hypothetical cash purchase day 0.

Often saves $1,500-$3,500 on Hyundai/Kia/Subaru where lease cash > cash rebate. Watch for: acquisition fee, disposition fee (waived if you buy out), and any "lease loyalty" lockouts the captive may apply.

Worked Example

2026 Ioniq 5 SEL, 36mo / 12k mi lease (2026 acquisition — federal §45W is $0, TERMINATED 2025-09-30):

• MSRP: $51,150
• Residual (55%): $28,133
• Money factor: 0.00125 (~3.0% APR equivalent)
• Federal §45W pass-through: $0 (TERMINATED 2025-09-30 — not available in 2026)
• OEM lease cash (if advertised, ordinary marketing money, verify on worksheet): varies;

treat as a negotiable OEM incentive, NOT a federal credit. Assume $0 for this example.

• Acquisition fee: $650
• Adjusted CapCost: 51,150 + 650 = $51,800

Monthly base = (51,800 - 28,133) / 36 = $657.42 Rent charge = (51,800 + 28,133) * 0.00125 = $99.92 Pre-tax monthly = $757.34

Apply NJ tax (lease-friendly, monthly only) at 6.625%: $50.17 Final monthly: ~$808

> Historical contrast (pre-2025-10-01 acquisition only): with the §45W -$7,500 cap cost > reduction that used to exist, adjusted CapCost was $44,300, pre-tax monthly ~$540, > final ~$575. That ~$233/mo gap is the value the now-terminated federal credit used to > deliver. It is gone for any 2026 lease.

Cash alternative for same buyer:

• MSRP $51,150, negotiated to $48,000, plus TTL ~$3,000 = ~$51,000 OTD
• No federal credit on either side (§30D / §25E / §45W all terminated 2025-09-30)
• 36-mo TCO at lease (2026): 36 * $808 = $29,088 + $0 residual exposure (return car)
• 36-mo TCO at cash: $51,000 - resale ~$30,000 = $21,000 net depreciation

Without the federal credit the lease's monthly is much higher, so cash purchase now generally wins on 36-mo TCO and clearly wins at 6+ years. Check live state rebates (via ev-buyer-helper) as the only remaining incentive layer.

Cross-References

• ../orchestrator/references/lease_playbook.md - full formulas, residual

tables by OEM, region-specific MF charts, all 50-state tax mechanics

• ../orchestrator/references/ev_buyer_playbook.md § §45W commercial credit
• full pass-through tables and lessor list (HISTORICAL: §45W terminated 2025-09-30;

see ev-buyer-helper CRITICAL banner — no federal lease credit on 2026 acquisitions)

• ../orchestrator/references/state_fees.md - state TTL components for the

cash-comparison side

• ../orchestrator/SKILL.md Critical Rule #4 - never quote a lease monthly

to the buyer without showing the MF + residual + cap cost breakdown

Output Contract

After every lease analysis, return to the operator:

Lease vs Cash analysis - 
  Vehicle: , MSRP $
  Lease offer:
    Term:  mo / k mi
    MF: 0. (buy-rate .0%, markup )
    Residual: % = $
    CapCost (adjusted): $
    Monthly (pre-tax): $
    Monthly (with state tax): $
  Cash alt: $ OTD, 36mo NPV $
  Verdict: LEASE / BUY / BREAK-EVEN
  Captive policy: early buyout , disposition $

Source & license

This open-source skill is cataloged on AgentStack and links to its original source — we do not rehost the code.

• Author: DaizeDong
• Source: DaizeDong/buy-me-a-car
• License: MIT

Install and usage instructions live in the source repository linked above.