Chances are, you're looking for current information on the hybrid car tax credit. Follow the link to find out about the 2007 hybrid car tax credit.
The following list shows the cars approved by the IRS for the federal tax credit in 2006. Any owners of vehicles purchased or placed in service in 2006 are eligible.
*2006 Honda Accord Hybrid AT and Navi AT without updated calibration qualify for a credit of $650.
The Energy Policy Act of 2005 replaced the clean-fuel burning deduction with a tax credit. A tax credit is better than a deduction since the credit is subtracted directly from the total amount of federal tax owed. But keep in mind this credit can only be applied to vehicles purchased or placed in service on or after January 1, 2006.
Hybrid Car Leases
Keep in mind that those who lease hybrid cars are not eligible for the federal tax credit, although companies that lease hybrid cars are.
Future Tax Credits
Future consumers of Toyotas hybrids should be aware of the 60,000 vehicles sold limitation. Toyota has already passed this limit and so the tax credit reduction is already in play. According to the IRS, taxpayers may claim the full amount of the allowable credit up to the end of the first calendar quarter after the quarter in which the manufacturer records its sale of the 60,000th hybrid or advance lean burn technology. For the second and third calendar quarters after the quarter in which the 60,000th vehicle is sold, taxpayers may claim 50 percent of the credit. For the fourth and fifth calendar quarters, taxpayers may claim 25 percent of the credit. No credit is allowed after the fifth quarter.
That means you have until September 30 to purchase a Toyota hybrid and still be able to qualify for the full tax credit. From October 1st through the next two quarter, you will only be eligible for half of the credit.
Hybrid technology is currently available in cars, suvs and trucks. Hybrid vehicles are powered by engines with dual power sources, one gas the other electric.
Local Tax Incentives
Some states also offer other incentives to those who buy hybrid vehicles. Some allow hybrid vehicles into the hov lanes, others give tax incentives. And even some towns and cities let hybrid cars park for free in metered parking spots. Check with your local authorities.
Check with your tax advisor for the details.