The Senate, in creating their own bail out bill, has added hundreds of pages of new legislation. Part of it now addresses tax credits for PHEVs.
People who bought hybrid cars received a tax credit from the federal government until the manufacturer sold 60,000 qualifying hybrids. Toyota and Honda have already passed that mark, but Ford, GM and Nissan have not. The amount of the credit depended on the fuel efficiency of the hybrid vehicle.
The new PHEV tax credits (PHEV stands for plug-in hybrid vehicle) has a similar set up. The tax credit will begin the phase out after 250,000 qualifying vehicles are sold in the US. The phaseout period is the period beginning with the second calendar quarter following the calendar quarter in which the 250,000th vehicle is sold.
During the next two quarters, the credit will be 50 percent of the full total. And then for the 3rd and 4th quarter of the phaseout period, the credit will be 25% of the total. After that, it will be gone.
Unlike hybrids, plug-in hybrid tax credits will be based on the size of the battery pack. The base credit is $2,500 with $417 added on for each kWh over 4 kWh. The maximum is:
- $7,500 for vehicles under 10,000 lbs,
- $10,000 for vehicles 10,000 lbs or more, but under 14,000 lbs,
- $12,500 for vehicles 14,000 lbs or more, but under 26,000 lbs,
- $15,000 for vehicles over 26,000 lbs.
The total cost of the tax credits is about $1 billion over the lifetime of the tax credit.
If you're interested, the relevant text is in sec. 30D. New Qualified Plug-In Electric Drive Motor Vehicles on page 190 (or so) of HR 1451.
The tax credit begins after December 31, 2008 and ends after December 31, 2014.
Section 207 (on page 202 or so) puts in an extension from 2009 to the end of 2010 for tax credits for alternative fuel vehicle refueling property credit and adds electricity as a 'clean-burning' fuel.
Section 211 deals with transportation fringe benefit to bicycle commuters (page 205 or so). I'm not familiar enough with the original bill it is amending to comment on what's being changed, but for those who commute by bicycle, you should probably take a look.