Volunteer fire departments and tax-exempt fire truck leasing

Volunteer fire departments (not-for-profit) enjoy the same tax-exempt privileges as municipal fire departments. That means you can get the same low, tax-exempt interest rate.

What do volunteer fire departments have to do to qualify for low interest rate fire truck leasing?

There are a couple of different procedures that a volunteer fire department must follow to meet IRS requirements.

First, the volunteer fire department must hold a public meeting. The volunteer fire department must comply with the open meetings act and publish notice of the meeting at least 14 days prior to the meeting in the local newspaper. Your banker should know how to do this and most include the cost of the ad in their services.

Second, the political subdivision (i.e., city, township, county, borough, fire district, etc.) that the fire department serves must sign a “Certificate of Approval”. This certificate certifies to the IRS that the volunteer fire department provides fire fighting services and that the political subdivision acknowledges that the volunteer fire department is borrowing the money.

Note: The Certificate of Approval does not mean that the political subdivision is guarantying or co-signing the lease purchase agreement for the volunteer fire department. This is not an IRS requirement.