President Obama’s stimulus bill, which is also referred to as the American Recovery and Reinvestment Act of 2009, enables us to claim certain benefits for hybrid vehicles. More specifically, Hybrid vehicles are offered a tax credit as per the stimulus package. All vehicles purchased from the year 2006 are eligible for the hybrid vehicle tax credit. The following includes some of the details of of the stimulus package.
Note that the best person to guide you effectively in this aspect is your tax consultant. Choose a good consultant and check out all possible details before filing your returns. You can also go online and read reviews, analysis and reports on the stimulus tax credit for hybrid vehicles to find more details.
The credit amount depends on multiple factors:
First, you must be the owner of extended range electric vehicles or plug in hybrids. Your hybrid model has drive trains which are powered by both rechargeable batteries and internal combustion engine.
Second, your eligibility depends on the vehicle model and the state where it was purchased. This scheme is also known as the Alternative Motor Vehicle Credit and all vehicles purchased after 1st January 2006 are eligible for this.
Third, if your hybrid vehicle was on road in the year 2008 and you are a taxpayer, then you can certainly claim credit. However, according to the stimulus package, credit will be given only to those who are the actual owners of the hybrid vehicles and not for those who have purchased the vehicle on a resale in the year 2008.
Fourth, the vehicle size and battery pack also plays a role in determining your eligibility for tax credit in the plug-in hybrid range. If you own a Chevy Volt, you should get a credit somewhere around $7,500 if you qualify. If you own a plug-in truck you may even be eligible for credit that can be as high as $15,000.
Finally, if your vehicle is extremely fuel efficient, you may even be eligible for credit worth $3,000.
In addition, there are other factors to consider:
- Credits will be given to new hybrid vehicles (those models which came out last year). The limit for a manufacturer is 60,000 vehicles. After this number of vehicles is sold, the available credit starts coming down until it is completely eliminated. Vehicle owners must wait for the manufacturer to reach the sales limit and file before the end of third month following the quarter.
- The manufacturing company is not an eligibility criterion and as of now around 500,000 vehicles are eligible for tax credits.
It is also worth noting that there are other benefits offered in this package, including a $2 billion grant for manufacturing and development in the battery sector. A tax paying buyer who goes in for vehicle conversion will be eligible for up to 10% of the conversion price or a maximum of $4,000.
In conclusion, whether you own a hybrid vehicle, or if you are planning on buying a new hybrid car, you may be pleasantly surprised to find a deduction in your local sales tax and auto loans.