Dear Friends of Our Firm,
The trend toward buying energy-efficient vehicles continues. If you bought a hybrid car last year—or if you’re searching for a new car this year—consider all the tax implications.
Under the current tax law, you may be entitled to a credit of up to $3,000 for a 2008 model or one of the newer ‘09 models. The credit replaced the previous “clean-air deduction” for vehicles.
However, be aware that the tax credits may be reduced for the most popular models. At a certain point, the credit no longer is available.
Reason: The IRS certifies a particular make and model as being eligible for the credit. The exact amount of the hybrid vehicle credit depends on a computation involving the mileage savings and the fuel economy for the car’s weight class. The better the car’s performance, the higher the credit.
Under the 2005 energy law, the credit begins to phase out in the second calendar quarter after the calendar quarter in which at least 60,000 of the manufacturer’s qualified passenger automobiles and light trucks have been sold. Once the manufacturer hits the 60,000 mark, the credit for all hybrid models it produces are reduced by 50% for a six-month period and then by 75% for the following six-month period. Finally, the credit disappears for good.
We can help you determine the available tax benefits for purchasing a hybrid vehicle. Do not hesitate to call our office at (618) 542-9127 to obtain more information.
P.S. Don’t overlook the potential tax benefits in this area. Call (618) 542-9127 to schedule a consultation.
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