my sister and I purchased the prius together. She is the buyer and i am the co-buyer. Can I claim for the tax credit as my sister will not claim for it. Please help.
that is a question best answered by a tax accountant. i presonally wouldn't fill in my tax return based on advice received from strangers on the 'net.
You don't submit anything. The title says she's the owner. Questions like these need to be asked before the transaction.
what if i do the tile transfer to my name at DMV, I am a a little confused to the IRS requirement: b. For qualifying vehicles used by a tax-exempt entity, the person who sold the qualifying vehicle to the person or entity using the vehicle is eligible to claim the credit, but only if the seller clearly discloses in a document to the tax-exempt entity the amount of credit. so, how the disclose in a document work?? if I do the transfer now, the year of 2008, I will have to claim the tax credit next year, right?? it won't matter if I owned a 2006 prius, right??
What makes you think that you qualify as a tax-exempt entity (most commonly a non-profit organization)?
I agree. Talk to your accountant, or call the IRS on a no-name basis, or run Turbo Tax or other tax prep software. I'm going to ask my own accountant, and will post his answer when I get it. So what follows is only my offfhand opinion ... I'm not an accountant or an expert. I suspect that you can claim the credit if you were one of the purchasers of the car, because: 1. I think who's name is on the title is irrelevant, as states' practices regarding name on title varies. For example, in some states, if you took out a car loan in order to purchase the car, it will be the lender or bank's name on the title. 2. I analogize to the situation of divorced parents and who can claim their child as a dependent. In many situations, both parents support the child and therefore the child is a dependent of both parents. But in any given tax year only one parent can claim the child as a dependent (the tax law doesn't permit both parents to claim the child as a half dependent of each). In my own case, my ex and I alternate claiming our daughter as a dependent. Last year, I claimed her. This year, my ex will claim her.
FYI, my tax accountant says that either co-buyer (but not both) can claim the tax credit. But I still think you should check with your own tax accountant or the IRS.
Again, make sure you check with your own tax accountant or the IRS. Be aware that although you do not have to submit a Certificate of Title (or other documentation evidencing ownership), the name on the Certificate of Title is at least some, and perhaps dispositive evidence of ownership (except in states where the auto lender/lienor's name goes on the Certificate of Title). I don't know how the IRS would react to your situation. Let's say you claim the credit, and you get audited. You go to the audit and show the IRS the invoice showing your sister and you as the buyers. If I were the IRS the first question I would ask is if your sister and you are co-buyers and co-owners of the car, how come you only put your sister's name on the Certificate of Title? Be aware that laws in general, and tax laws in particular, frequently recognize form over substance. Also, why isn't your sister claiming the credit? Anyway, good luck.
