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Federal Hybrid Tax Credits

Monday, June 22, 2009

(Electric Drive Transportation Association)

The Internal Revenue Service has acknowledged the certification of vehicles that qualify for the hybrid tax credit enacted by the Energy Policy Act of 2005. The tax credit for hybrid vehicles applies to vehicles purchased on or after January 1, 2006, and may be as much as $3,400 for those who purchase the most fuel-efficient vehicles.

Starting in 2006, this tax credit replaced the tax deduction of $2,000 which was previously allowed for taxpayers who purchased a new hybrid vehicle before December 31, 2005 for the clean-burning fuel deduction. The tax credit requires a different certification. Many currently available hybrid vehicles may qualify for this new tax credit.

Consumers seeking the credit may want to buy early since the full credit is only available for a limited time. 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 vehicle. For the second and third calendar quarters after the quarter in which the 60,000th vehicle is sold, taxpayers may claim 50% of the credit. For the fourth and fifth calendar quarters, may claim 25% of the credit. No credit is allowed after the fifth quarter.

The following tax credits apply:

2010 Model Year Hybrid Vehicles

Click here to see the full list of Model Year 2010 Vehicles that Qualify for Hybrid Tax Credits.

2009 Model Year Hybrid Vehicles

 

Model Year 2008:

Click here to see the full list of Model Year 2008 Vehicles that Qualify for Hybrid Tax Credits.