11-Nov-2006 Kiloran added the following 2 links to this post. FAQ - Phase-out of the hybrid tax credit Alliance to Save Energy - Phase-out of the hybrid tax credit Transcribed from document at http://www.ne.doe.gov/EPAct2005/hr6_textconfrept.pdf “(f) Limitation on Number of New Qualified Hybrid and Advanced Lean-Burn Technology Vehicles Eligible for Credit.-- “(1) In general.—In the case of a qualified vehicle sold during the phaseout period, only the applicable percentage of the credit otherwise allowable under subsection © or (d) shall be allowed. “(2) Phaseout period.—For purposes of this subsection, the phaseout period is the period beginning with the second calendar quarter following the calendar quarter which includes the first date on which the number of qualified vehicles manufactured by the manufacturer of the vehicle referred to in paragraph (1) sold for use in the United States after December 31, 2005, is at least 60,000. “(3) Applicable percentage.—For purposes of paragraph (1), the applicable percentage is— “(A) 50 percent for the first 2 calendar quarters of the phaseout period, “(B) 25 percent for the 3d and 4th calendar quarters of the phaseout period, and “© 0 percent for each calendar quarter thereafter.
It looks like Toyota will likely reach the 60k threshold in the second quarter. If that is so and if I'm interpreting the text of the law correctly, the full tax credit for Toyota will be in effect for the first 3 quarters of 2006. :lol:
Do you mean that someone ordering today could not expect to receive their car by the end of the third quarter? Seems unlikely to me.
Well I heard from someone that the list is pushed back as far as march at many places.. but that could be wrong... It may have to do with who your dealing with and now many they are allocated at a time?
Either way, I'm just glad I already have mine B). That includes ALL models right? Not just the first 60,000 priuses sold but also Highlanders etc, right? Seems like Toyota is selling just shy of 10K Prii/mo (sep/oct). I wonder what that number will be in JAN? I assume that it's expected to be a banner month.
Kiloran, What are you basing the projections on? Historical sales data or something else. Just curious.
Fuzzy recollections of articles I read online. However, I just went out and looked some up: http://hybridcars.about.com/od/news/a/hybridtaxcredit.htm http://www.foxnews.com/story/0,2933,173023,00.html http://www.consumeraffairs.com/news04/2005/hybrid_tax.html http://www.consumeraffairs.com/printme.php...hybrid_tax.html
Does anybody know if the credits are limited to one per household?... what if someone buys two prius's?
B) From my recent entries into the FAQ: The 2006 federal income tax credit for the Toyota Prius is generally estimated at $3150. This credit is intended to offset the cost of a car being outfitted with hybrid technology. Individuals can claim the credit for each vehicle that they purchase. Since this is a tax credit your tax bill is reduced dollar for dollar, it will not reduce your tax bill below your alternative minimum tax. The prior law's tax deduction of $2000 is still in effect until the end of 2005. Under the prior law, those in the top tax bracket would realize a maximum tax savings of $700 if they purchase a hybrid vehicle before January 01, 2005.
So if understand it correctly.. If I paid 13000.00 taxes owed "after deductions" and I bought two prius, I would get 6000.00 more dollars back than I would ordinarily correct? As long as I have paid in at least 6000.00 I would get it back correct?
I believe that is true provided your alternative minimum tax is greater than $6000. With these kind of numbers involved, it wouldn't hurt to consult with a tax advisor.
The way its worded on the http://en.wikibooks.org/wiki/Toyota_Prius_FAQ page is: The 2006 federal income tax credit for the Toyota Prius is generally estimated at $3150. This credit is intended to offset the cost of a car being outfitted with hybrid technology. Individuals can claim the credit for each vehicle that they purchase. Since this is a tax credit your tax bill is reduced dollar for dollar, it will not reduce your tax bill below your alternative minimum tax. Thats just saying my tax bill cannot be reduced below 0 dollars?... so If I paid in more than 6000.00.. wouldn't I qualify for the tax credit?
My bad. I believe the correct phrasing I should have used is that the credit cannot reduce your taxes below your Alternate Minimum Tax. If your AMT is zero, the credit cannot reduce your taxes below $0. It sounds to me like the answer to your question is yes, if you buy two Prii prior to the phaseout period (which cannot start before June 15, 2006) your taxes would be reduced by twice the tax credit for the Prii, currently estimated at $3150 each. I'm not a tax professional so follow any advice from me at your own risk.
Thanks for taking a second look.... anything tax related seems to be worded strange!... Thats the way I interpret it too... I"m not sure exactly what qualifies you to have a minimum tax.. I think you have to make over 150K or somewhere thereabouts... not sure.... I haven't been that blessed yet to worry about that yet!... thanks...
