Tax Breaks on “Tree Hugger” Cars may be Expiring…

Newly purchased hybrid vehicles (you know, “tree hugger” cars) may offer some tax credit incentives to the purchaser.  The IRS certifies how much the credit will be by car, depending on the information the auto dealers are feeding to the IRS, and how fuel efficient the vehicle is.  For example, a Chevrolet 2008 Malibu Hybrid gets a $1,300 credit while a Honda 2008 Civic Hybrid CVT gets a $2,100 credit.

But the tax law was written so as to phase out (over a certain period of time) the tax credit once the manufacturer of the vehicle sells 60,000 models.  If you are buying Hondas, then your tax credit is half of what you probably thought it was.  Honda hybrid credits started phasing out early 2008.  Credits for a Toyota or Lexus dried up in the fall of 2007.

Before buying, find out where your potential vehicle purchase stands here (scroll down on the report). Go green!!

IRS Circular 230 Disclosure: To ensure compliance with requirements imposed by the IRS, we inform you that (i) any U.S. tax advice contained in this communication (including any attachments) is not intended or written to be used, and cannot be used, for the purpose of avoiding penalties under the Internal Revenue Code; (ii) any such tax advice is written in connection with the promotion or marketing of the matters addressed; and (iii) if you are not the original addressee of this communication, you should seek advice based on your particular circumstances from an independent advisor.

 

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