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Tax credits / incentives for hybrids?

SylviaSylvia Posts: 1,636
edited March 15 in Toyota
Does your state offer some type of incentive for buying a hybrid? Do you find it confusing? Here's the place to ask your questions.
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Comments

  • gagricegagrice San DiegoPosts: 28,908
    Sounds like Oregon is serious about hybrids. A $1500 tax CREDIT is substantial. Unless of course the Toyota dealers are greedy like in CA.

    http://www.registerguard.com/news/2004/08/16/b1.cr.hybrid.0816.ht- ml
  • rpgolferrpgolfer Posts: 157
    gagrice- I live in California and I should be able to file for a $1500 tax credit this year with my returns. Last year if I had taken possession, I could get $2k. I am going to persue the return with my tax guy when I do my '04 taxes.
    mfullmer- Drive that new Solara (congrats) down to the Toyota dealership and buy BOTH new cars!! This way you'll have that shiny new Solara, be in debt up to your ears and the Salsa Red Pearl that you've always wanted, too!
    Thanks,
    Rich
  • gagricegagrice San DiegoPosts: 28,908
    I wonder how many states offer tax credits on hybrids?
  • tempusvntempusvn Posts: 119
    I know that up until July 1, Maryland forgave all state sales tax on hybrids (5% of purchase price), which was significant. They haven't renewed that one yet.

    West Virginia is great, they offer:

    "a tax credit equal to 40 percent of the incremental cost for the purchase or lease of a dedicated alternative fuel vehicle. An additional credit equal to 30 percent (for a total of 70 percent) of the incremental cost is provided for the acquisition of a dedicated alternative fuel vehicle that meets stringent emissions standards"

    When you take calculate that out for a Prius, it works out to a direct writeoff of $3,750 against state income taxes, but you have to spread it over three years.
  • mfullmermfullmer Posts: 819
    Actually the next house we buy definitely has to have a three car garage then I can get a Prius and we can use that and the Lexus to commute and save the Solara for the weekends!

    Three car garages are hard to come by here in Atlanta. In CA I never had a house that didn't at least have a three car garage!
  • CA has no state tax credit on hybrids. You're referring to the Federal DEDUCTION of $1500 for 2004. This will go down by $500 each year and phase out in 2006.

    Mike
  • rpgolferrpgolfer Posts: 157
    solar_dad- You're right, Ca doesn't have state tax credits, only the feds do. But, there are legislations pending to allow hybrids in the "diamond" (HOV) lanes. They just notified me that smog checks are no longer needed and I'm hoping that registrations can be extended beyond the current 2 yr period. I, like John, believe that HSD technology will be common place and hybrids are here to stay.
    Thanks,
    Rich
  • stevedebistevedebi LAPosts: 3,786
    "They just notified me that smog checks are no longer needed and I'm hoping that registrations can be extended beyond the current 2 yr period."

    Wonder who made that bone headed mistake? The Prius has an ICE, which needs to be monitored for comopliance with CARB. Perhaps it could use a longer period between checks, but it still needs to be checked...
  • oranuoranu Posts: 10
    Assuming purchase of an Accord Hybrid in California for $33,505 prior to end of this month in 2004, and a top marginal tax bracket of 28%, how much money would be saved because of the 2004 tax benefit? (As I am confused by the tax benefit, even an approximation will be of help.)

    Oranu
  • backybacky Twin CitiesPosts: 18,695
    First there is the question as to whether the HAH will qualify for the Federal tax deduction, which for 2004 was restored to $2000 (note it's a tax deduction, not a tax credit). Perhaps one of the new owners of the HAH can tell us what they heard from dealers about the tax deduction. If the HAH qualifies, you can deduct $2000 from taxable income, so your savings depends on your tax bracket.
  • I live in New York and have bought a Toyota Prius 2005. I have heard State laws differ from state to state and I am looking for facts & not fiction about the hybrids. Example(s) Federal Tax Credit of $2000 from IRS, Each state may offer more tax credits or rebates. State of Conn. offers no Tax when you buy a hybrid. In Washington D.C. you may use the H.O.V. lanes with only one person in the car, as long as it is a hybrid.

     

    What other laws exist and how do people go out and find them for the state they are in?

     

    Please help me find out more information.
  • larsblarsb Posts: 8,204
    "State tax credits, deductions, and exemptions are available in California, Colorado, Maryland, New York, and Oregon. New Jersey offers rebates to local government entities purchasing hybrids. In Washington, some hybrids vehicles are exempt from emission control inspections. "

     

    This page also contains a PLETHORA of Hybrid tax info and other handy tips:

     

    http://www.fueleconomy.gov/feg/tax_hybrid.shtml
  • larsblarsb Posts: 8,204
    "In addition to federal incentives, individual states offer additional incentives, rebates, or grant programs to encourage purchase and leasing of hybrid and low/zero emission vehicles. For example, Colorado currently offers a state tax credit of $2,678. For Colorado residents, combining the state tax credit with the federal tax deduction would essentially eliminate the $3,000 premium paid for the hybrid technology."
  • Thank you for writing to the State of Connecticut Department of Motor

    Vehicles. The DMV is always working to improve customer service. We hope

    that this process will give you the service you need and answer the

    questions you have.

     

      It is true, Hybrid vehicles are tax exempt. If you give me a fax number I

    can forward additional info to you.

     

    Again, thank you for writing to the Department of Motor Vehicles. If you

    have additional questions, please contact us again at: mail@dmvct.org
  • Maryland's incentive is simple.

     

    No sales tax on hybrids. So you save about $1000 instantly.

     

    troy
  • dw438dw438 Posts: 41
    In New York you can get a sales tax refund by filling out a form (AU-11) and sending in separate from your tax return. State says they are three months behind in processing.

    You also can get a credit on income tax by filling out another form (IT-253. Alternative Fuels Credit) and filing that with your income tax forms.

    Go to this link on the NY State tax dept. web site:

     

    http://www.tax.state.ny.us/pdf/memos/Multitax/M04_3.1i_1.1s_2.1c.- pdf
  • There is a State by State - Tax, Carpool lane use & other hybrid cars incentives:

     

    http://www.hybridcars.com/incentives.html

     

    local tax and other hybrid incentives

     

    We're doing our best to track hybrid incentives across the country. Please verify exact current rulings with appropriate state or city officials. Hybrid car buyers also qualify for federal tax deductions, and in some states, solo use of carpool lanes.

     

    New York's:

    New York's Alternative Fuel (Clean Fuel) Vehicle Tax Incentive Program offers tax credits and a tax exemption for purchasing new hybrid electric vehicles (HEVs), alternative fuel vehicles (AFVs), and/or install clean fuel vehicle refueling equipment. Purchasers of qualified HEVs are eligible for a tax credit of up to $3,000, depending on the vehicle's fuel economy. To qualify, a vehicle must draw propulsion energy from both an internal combustion engine (or heat engine that uses combustible fuel) and an energy storage device; and must employ a regenerative braking system that recovers waste energy to charge that device, and, for model year 2004 and later, must meet or exceed the California LEV II emission standard. Current production models such as the Toyota Prius and Honda Insight qualify. The maximum value of the incentive is $5,000 for vehicles weighing less than 14,000 pounds (lbs.) gross vehicle weight rating (GVWR). The incremental cost of clean-fuel vehicles is exempt from state sales tax; this exemption expired February 28, 2004. These incentives apply to vehicles and fueling property placed in service by December 31, 2006. For more information, please contact the New York State Energy Research & Development Authority (NYSERDA) at 866- NYSERDA, via email at info@nyserda.org, or visit the Web site at www.nyserda.org. (Reference Senate Bill 4523, 2003)
  • rfruthrfruth Posts: 630
    Some companies kick in a few grand too - snip - The latest - and largest - company to begin offering employees incentives to purchase fuel-efficient hybrid vehicles is Stratham-based Timberland, a global leader in the design, engineering and marketing of footwear, apparel and accessories. The company is offering a $3,000 grant for any of its 6,000 employees (700-800 are located in the Stratham headquarters office) to help them get a hold of one of the new hybrid vehicles. Currently offered by Honda, Toyota and Ford, the vehicles combine electric motors and gasoline engines to generate fuel economy ratings in some cases exceeding 50 miles per gallon.

     

    http://www.seacoastonline.com/news/12272004/news/56019.htm
  • dug1dug1 Posts: 1
    Does anyone know of any state tax incentives for the state of GA? The only thing I seem to have found is that you can ride in the HOV lane.
  • As mentioned above - The Fed kept the 2004 and the 2005 tax deduction for hybrids at $2000. The 2006 deduction is still at $500 though - what it would have been with the steady $500 drop for 2004 and 2005.

     

    Here in New Mexico - no sales tax on the car or any of the accessories purchased with the car.

     

    Also, the Honda Civic Hybrid has an immobilizing anti-theft system as standard equipment so you also get a break on insurance.
  • gagricegagrice San DiegoPosts: 28,908
    For example, the Toyota Prius--America's best-selling hybrid at 30,000 units sold last year--is typically bought by childless couples with an annual household income of $100,000, according to Toyota's own demographic study. The car has become a status symbol among the liberal Hollywood elite. Millionaire celebrities like Cameron Diaz, Leonardo DiCaprio, Larry David, and Jack Black are all proud owners of the Prius and its $2,000 tax break. And this year, Toyota is offering its second hybrid vehicle through its luxury division, Lexus. The Lexus E330 SUV hybrid--already pre-sold to 11,000 buyers--is being gobbled up by Hybrid Liberals making $130,000 a year on average.

     

    With the Lexus SUV and other new hybrid offerings from Mercedes, Honda, and Ford, hybrid sales are expected to more than double this year to 165,000 units in the United States. That means a total federal subsidy of some $330 million to upper-income customers.

    Keith Ashdown, vice president for policy for the non-partisan Taxpayers for Common Sense, however, is skeptical the hybrid tax credit is serving its purpose. "You want tax breaks that alter consumer behavior. This tax break probably isn't working because it's putting money into the pockets of people who would buy this product in the first place." Even with the subsidy, however, auto companies are losing their shirts on hybrids. Since gasoline/electric hybrids use two power sources--a combination of a gasoline engine and an electric motor--they are substantially more expensive than standard cars. Though hybrids typically sell at a sticker price of $3,500 over comparable gasoline cars, manufacturers are not recouping their costs.

     
    The costs put manufacturers in a box. They cannot make money on hybrids, and yet their public relations value among Hybrid Liberals in the press, Hollywood, and elsewhere mean they cannot afford not to. Even GM product guru Bob Lutz, one of the industry's legendary executives and a hybrid skeptic, admits that General Motors' decision not to get into the hybrid business was a mistake.

    We failed to appreciate that Toyota basically treated it as an advertising expense. They said we need these to demonstrate our . . . concern for the environment, capture the imagination of the growing environmental movement in the U.S., and get all those East and West Coast intellectual opinion leaders, movie stars, etc. on our side, which they successfully did. So even if they lose money on it, it's cheap at twice the price."

     
    Whether or not tax credits should be going

    to well-off car buyers, the hybrid subsidy is but a foot in the door of federal efforts to fundamentally alter the auto market. And, despite the blue state concentration of hybrid buyers, it is an effort that transcends party lines.

    Congressman Camp, for example, is a self-described conservative Republican. He sponsored the hybrid tax break, his spokesman Eastman explains, because "Congress is saying now is the time to transition to sources that are eco-friendly and lower our dependence on foreign oil."

     

    http://www.weeklystandard.com/Content/Public/Articles/000/000/005- - /176pszws.asp
  • muxdemuxmuxdemux Posts: 1
    That article has to be one of the most ludicrous, unbelievably inane pieces of biased drivel to ever be published in a newspaper. The Toyota Prius accounts for a greater percentage of the hybrid market than all other manufacturers combined. The sheer fact that it has a sticker price of somewhere around $20,000 makes his reference to it being a vehicle for the rich completely moronic. If the rich were all driving $20k cars, we'd be a far less pompous society.
  • gagricegagrice San DiegoPosts: 28,908
    If the rich were all driving $20k cars, we'd be a far less pompous society.

    Welcome to the forum. You may have a point. If we were all driving the same car it would make things easier. Just like kids in school wearing uniforms has been a good thing to many parents. I think the reference to the Prius being bought by the wealthier was started by Toyota. They advertised that the car was mostly bought by people making $100k-$150k per year. Hardly the wealthy of this nation. They also targeted the Hollywood green activists to promote the car. Another thing to consider is that through most of 2004 it was difficult to find a dealer that was not marking the car up past the MSRP. Plus adding a lot of charges just because the car was in demand. I think by the end of this year you will find them for a decent price. That being said I doubt that many that have bought hybrids did so based on that $2000 tax deduction.
  • larsblarsb Posts: 8,204
    The average car buyer's income is $89K - so a Prius buyer's average being $100K is not that big a deal....11% difference.....big whoop......Ask any Prius owners on this board if they are in the "over $100K" category....
  • I don't know. I think the article writer has a good point:

    IF the average prius owner income is $100,000 a year...
    Then why are we giving them a tax break??? Tax breaks should go to the poor, not the upper classes.

    Perhaps if the tax break was based upon income... i.e. You get a $2000 hybrid deduction, only if you're income is low.

    troy
  • gagricegagrice San DiegoPosts: 28,908
    I think that was the point the writer was making. People that make $100k or even $89k per year are not that needy that paying $500 less on their taxes will help make the decision. First it has been established that buying a hybrid is not as much an economical purchase as it is a environmental purchase.
  • With gas prices climbing it is now an economical decision as well - i expect to save over $2000 a year in gas alone - nevermind my future 2005 tax break ;-) -- I'm not sure I understand the whining about the income of the consumers. I will admit I meet the profile, but only just. A new technology cannot afford to sell too cheap or it cannot sustain any momentum. It is basic economics of supply and demand coupled with a new technolgy. At first the cost will be inflated because of a limited supply; if successful, the price will be inflated because of demand, this will prove the market and the price will slope off (or not climb as steeply) as the market becomes more infiltrated and new competitors arrive in the market place; and if you want to look a little farther ahead, you will see this same pricing and demand pattern repeated with the upcoming fuel cell vehicles (which, btw, will drive the price of hybrids down). - I'll stop the ecomomics lecture and ask again, why the complaining about consumers' income bracket when this is needed in order to make a desireable product successful? - I came here looking for the tax break info, but couldn't help responding to this somewhat intriguing thread ..
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