As a domestic auto incentive, Congress built a 60,000 vehicle limit on qualifying hybrid (and other alternative cars) being sold by each auto maker. Toyota bypassed that limit in 2006 and since then, the tax credits have been halved, and in April, those credits will be halved again.
| Tax credits peter out for Toyota | ||||
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| The tax credits for Toyota hybrids are being cut because the automaker has sold 60,000 hybrids. Credit amount according to purchase dates: | ||||
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| Vehicle | Full credit by 9/30/06 | Half credit 10/1/06 to 3/31/07 | Qtr. credit 4/1/07 to 9/30/07 | No credit after 10/1/07 |
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| '05, '06, '07 Toyota Prius | $3,150 | $1,575 | $787.50 | $0 |
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| '06, '07 Toyota Highlander 2WD, 4WD | $2,600 | $1,300 | $650 | $0 |
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| '07 Toyota Camry | $2,600 | $1,300 | $650 | $0 |
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| '06, '07Lexus RX 400h 2WD, 4WD | $2,200 | $1,100 | $550 | $0 |
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| '07 Lexus GS450h | $1,550 | $775 | $387.50 | $0 |
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| Source: IRS | ||||
So, depending on when you purchase and receive your Toyota hybrid car can really make a difference in your bottom line when it comes to tax time. As it is, Toyota is pressing for an extension on the tax credit time line, but they are getting little support from other carmakers for obvious reasons.
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