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Separately, does anyone know if you can get the hybrid tax credit if you lease (36 mos)?
YES, both purchases and leases qualify for the tax credit. The credit for RX400h is estimated to be $2,200. (http://www.leaseguide.com/Articles/hybrid-tax.htm )
BTW- I was very reluctant to go Lexus, but I LOVE my RX400h. It rides SO much better than the RX330 thanks to the ECVT. It feels like it is floating. I have an Audi with CVT and hated the RX330's rough and clumsy ride.
BTW2- The Range Rover Sport was my 1st choice, but decided to keep an open mind. Glad I did b/c it saved me $17K. Plus, I bought myself 36 mos to wait for the RRS to come in a diesel or hybrid.
regards,
kyfdx
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for resale.(4) The vehicle is used predominantly in the United States." Thus, it would appear that you can purchase a qualifying car and take the credit even if you lease it out to someone else BUT you must be the owner of the car (not the lessee) to get the credit.
I don't see it that way; it appears to me that item (3) indicates that it is the taxpayer who is getting the lease:
The vehicle is acquired for use or lease by the taxpayer, and not
for resale.
I would consult a professional tax consultant on this one...
1)http://www.irs.gov/newsroom/article/0,,id=153172,00.html
This is the IRS's site and the above link goes to a recent press release.
2)http://taxes.about.com/od/deductionscredits/a/hybridtaxcredit.htm This article is written by William Perez, a tax professional who previously worked for the IRS and now works for a private CPA firm. He states in his article "There are three criteria to qualify for the hybrid tax credit:
1. Purchase a qualifying vehicle in 2006.
2. Purchase the vehicle new, not used.
3. The vehicle must be used for your own personal or business use. The vehicle should not be bought with the intention of re-selling it."
3)http://www.energytaxincentives.org/tiap-passenger-vehicles.html This is the Tax Incentives Assistance Project (TIAP) site. TIAP is a coalition of public interest nonprofit groups, government agencies, and other organizations in the energy efficiency field. In their FAQs section they state: " Who is eligible for the tax credits? Buyers and lessors of qualifying vehicles. For purchases by tax-exempt entities, however, it is the seller who is eligible for the tax credit. The benefit of the vehicle credit may be reduced or eliminated for taxpayers subject to the Alternative Minimum Tax; IRS will address this issue in future guidance."
It is, of course, important to confirm this information with your own tax advisor. AND - the IRS might change its mind before the end of 2006 to allow lessees of hybrid vehicles take advantage of the credit.
If any of these conditions change within 3 years of purchase, you may have to return some of the money saved by the deduction.
http://www.fueleconomy.gov/feg/tax_hybrid.shtml
I understand your argument, and I did read the entire context the first time. However, the taxpayer is the person applying for the tax credit, and the taxpayer has to be the leasee, so the only way I see it making sense is if it applies to both purchases and leases. It would make no sense to have the Purchaser someone other than the person filing the taxes (the taxpayer). Typical IRS poorly written guidelines. I stand by my interpretation, but I am not a tax professional.
Anyway, as I said earlier, check with your tax professional.
Individual purchasers of a Lexus RX 400h ...
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US Government DOE website says you can lease. Who knows?
http://www.energy.gov/taxbreaks.htm
"Individuals and businesses who buy or lease a new hybrid gas-electric car or truck are eligible for, and can receive, an income tax credit of $250-$3,400 – depending on the fuel economy and the weight of the vehicle. "
However, I don't buy the "Purchase then lease"; I think that the original purchaser has to keep the vehicle. I realize that technically the leasing company owns the vehicle, so you may be correct.
I think my original idea (not mine alone) is the best - consult your tax professional...
I leased at a substantially higher rate a week prior and Lexus re-wrote the contract without any hesitation. I was WOWed. Again, I wasn't very keen on buying a Lexus, but the 400h has been great and I've been able to take their great customer service to the bank.
When I got to the dealership a few days later, I examined the car, the printed paperwork, and I was out of there with my new car in little over an hour! As smooth a car-buying experience as you can have and I would HIGHLY RECOMMEND them in the area (a complete opposite experience than with Santa Monica Lexus which tried to change the price on me after I got to the dealership)!
I hope this information helps other prospective purchasers in the area.
I want to try to configure the car on the website.
I am located in San Pedro and Longo isn't that far away.
Thanks.
I configured the car on Carsdirect and Autobytel. I believe the MSRP was around $49,350. Carsdirect will only give you a few options from which to choose (because most of items that are "options" in the 330 are included in the 400h).
I hope that helps.
MSRP - $50,500 (Nav, Mark Levinson, etc...)
Cap cost - $45,000
15k miles
36 months
59% residual (do they normally take this from the cap sot or the MSRP)
MF = .017
Monthly payment $675 (incl. tax)
The only up front money is for my first payment. Everything else is wrapped into the lease.
Does this sound like a fair deal?
Thanks for the feedback.
Thanks.
The dealership is Lexus of Las Vegas. I originally wanted the RX350 FWD w/nav, but the numbers were high compared to what others were paying for the 06' 330's. The dealer told me they weren't offering any incentives or willing to discount the 350's to near invoice levels. I then searched the net for more info and stumbled across Fleetrates.com. Their prices were the same as the local dealer in Vegas, but they mentioned that Lexus was running specials on the 400h. I worked the numbers with them and like any good buyer, I called my local dealer to see if they could beat it...they did.
If you can't get this deal with your local dealer (I'm sure you can), you may want to give Fleetrates.com a try. they are based in California and can ship just about anywhere. If nothing else, they will give you good solid numbers to use as leverage with your local dealer.
I hope this helps. Good luck!
One last thing. Can anyone tell me whether the residual is based on the MSRP or the Sales price???? My dealer is telling me the MSRP, but I want to confirm this.
Thanks.
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I guess the RX400h is one hybrid that is selling for a reasonable price..
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MSRP: 49,928
Cap Cost: 45,100
MF: 0.0017
Residual: 59%.
15k miles/yr 36 months
Well he checks with the Gen. Sales Manager and tells me they can do everything except that the Residual will be 57% as that promo expired last month and showed me paperwork from Lexus Financial and tells me that its going to cost me a $1000 more for the lease. Now these are the payments he offered me (supposedly based on the terms mentioned above)...703 /mo with 703 down or 600 something w/4000 down (as I was willing to put down 4000 to lower the payments). I asked him if I could sit w/Gen Sales Manager while he is punching in the numbers so that I could see the details myself..he checks and comes back saying the guy was busy..now this was a Tuesday and I could see all the other Sales People idling away. So, thankfully and good heavens that I did...I tried to get another 500 knocked off the price and when they refused to budge I walked out. BTW, on my way back I called a dealer in VA (coz they are much closer to my house) to check if they could match it based on the #s above and I intentionally did not tell them the monthly payments that Rockville came up with...well they flat out told me to get the car from Rockville. At this point (and I was way too deep into VA) I started thinking that maybe Rockville did offer me the best deal, so I call the sales person at Rockville and offer a $1000 deposit on Visa to hold the car...he gladly agrees on the condition that I come back in 24 hours to complete the deal.
Now imagine my surprise when get back home and I put the numbers on an online lease calculator (making adjustments for the TTL, Acquisition Fees) and realized the monthly payments they offered were way off (close to 100/mo off).
Next Day I call back and explain the issue to the Sales Person..He tells me he can't do anything and cannot explain to me why the #s dont add up as it was the Manager's day off and to check back the next day (i.e., today). Now surpise..surprise..today the Sales Person calls me back (after I left 2 VM messages) saying they can only do the deal with the monthly payments that were mentioned and the reason it doesn't match my calculations is because they used a higher MF...it just left me stunned..after wasting 3 hours w/them 2 days back he comes back to tell me they were not entirely honest. So we end the conversation there...No Deal...but wait its isn't over yet.
So...I get an idea...when dealing w/Sales Person he kept on highlighting that they were giving almost $5000 off. So I call him back and say ok...since the lease didn't work if they would sell me the car for cash at the agreed upon price (i.e., 45,100)..he says that it should not be a problem and will get back to me after checking w/Gen Sales Manager. But just what I had expected..he calls back and tells me that they cant do the price even though 2 days ago that was the price on his worksheet...I could feel the guy feeling bad...but thats that...One thing I have learnt if you want to do a lease do your homework and if possible take a lease calculator with you or use it at the delaership. Incidentally when I had requested access to teh internet they said the lines were down as they were undergoing renovation. I am now going to try and complain about the whole experience to Lexus Corporate and as many Executives as I can get in contact with coz I honestly did not expect this at a Lexus Dealership. Even my Honda dealer is much more honest than these guys!!
A lot of us have gone through similar experiences in the past. However, we can use this Forum to learn from each other. I have been leasing for almost 20 years so here are some tips from my experiences:
1. Do not deal with Salesmen when doing a lease. When visiting a dealership or talking on the phone, ask for the Fleet Manager.
2. Don't negotiate the deal right after test-driving the car at the dealership. Make a separate visit to a dealership just for the test drive, get a brochure, and go home. Decide on the options, color, etc. and then request a quote through Edmunds.com or a similar site which will be directed to the Fleet Manager at a local dealership.
3. Plug in the numbers in a Lease Calculator and make sure your monthly payment is acceptable. A good way to verify that your Lease Calculator is accurate is to plug in the numbers from an advertised car and check the results. A lot of the Lease Calculators online add pre-determined amounts for fees, etc. I prefer to use my own spreadsheet.
3. After you request a quote through the Internet, you will get a call or e-mail from the Fleet Manager within 24 - 48 hours. Inform him that you are serious about closing a deal on a car with the selected options and color. Ask him for the following: MSRP, Money Factor, Residual, Term, Lease Inception charge, and Sales Price.
Here is the Lease Formula (confirmed by Lexus and Mercedes-Benz). Plug in your numbers:
Residual = MSRP x Residual Percentage
Monthly Depreciation = (Sales Price - Cap Reduction - Residual) / Number of Months of Lease
Monthly Rental Charge = (Sales Price - Cap Reduction + Residual) * Money Factor
Add the Depreciation and Rental Charge to get your Monthly Payment before taxes
4. Your goal is to get the lowest MF, highest Residual, and lowest Sales Price. Assuming that your credit is excellent, you should be able to get the lowest MF and 0 Cap Cost Reduction. The high Residual will lower your payment and give you the option to walk away from the lease at the end of the term.
I suggest that you negotiate over the phone from home with the Lease Calculator Spreadsheet. Once you reach an agreement on the terms, have the dealer fax you a printout from his computer or e-mail them to you.
My experiences are based on leases on Lexus, Land Rover and Mercedes-Benz. "Your mileage may vary". Good luck on your next attempt.
Zaheer
I don't have those numbers, but Car_man will..
We don't have a forum specifically for Lease Questions for the hybrid model, but if you post here: Lexus RX 330: Lease Questions, I'm sure that he can answer your questions..
Be sure to emphasize the you need the numbers for the RX400h..
You can be certain that the residuals are different for the higher mileage lease... Typically, the residual decreases 2% when you move from 36K to 45K miles..
regards,
kyfdx
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I finally picked up the Rx 400h on April 30th and am absolutely loving it. Put on a 100 miles so far at 26.5 mpg (mostly city though).Here's the details of my lease deal from lexus of Silver Spring:
RX 400h AWD w/Nav
MSRP: 49928
Gross Cap Cost: 45100
Residual: 57%
MF: 0.0017
15k mi/yr 36mos
I think it was a pretty decent deal, I may have been able to knock off another couple of hundred $ but after a month of trying and one terrible experience decided it was finally time to take the plunge.
recommending a fleet manager to do these
deals. Is there some type of requirement for
going through the fleet salesmen, such as
through a coporation or business or can
anyone contact a fleet manager/sales to get
quotes? I'm pretty curious how this works, if
anyone can explain it for me. Thanks.
By the way, CarsDirect.com would not lower the price from full MSRP because of lack of inventory of the model, options I wanted.
Carman - Is this true? The 400h 36 mo/12k miles used to have 58% and 0.0017? Do you have anby updates for us?
Thank you.
Money factor .0017
Residual .57
I'm being told that the best that can be done is:
Money factor .0020
Residual .54
This is through Lexus for a 36mo. 15K mile per year lease. I'm in So. Cal and have tried Longo who gave me a small, but not compelling, discount on the car, Vista and Oxnard had the same rates. How are the rest of you getting the rates discussed in this thread?
Money factor: .003
Residual: 55%
Cap Cost: 47,370
36 mths/45,000 miles
Anyone have thoughts on these #'s? Should we wait until the'07 (I assume it'll have a better residual)?