Tax Credit for 05 FEH
#11
08-22-2006, 12:01 PM
Re: Tax Credit for 05 FEH
[QUOTE=
HOWEVER, the one drawback to a tax credit is that you can't use it if you don't OWE taxes. And tax credits are one of the last things that are applied when filling out your tax return. So, if you end up with a tax refund, you can't then apply the tax credit to get MORE of a refund. You simply can't claim the credit. Even if you end up owing taxes, but owe less than the amount of your credit, you can't use the full amount of your credit.
[/QUOTE]
Scott, I agree with you on all your points except the above paragraph. Actually, not the entire paragraph, just the part that starts with "So, if you end up with a tax refund..."
If you end up with a tax refund, you CAN apply the credit to get MORE of a refund IFF your refund is not your entire tax liabiliity. For example, if I owe the IRS $7k in taxes, but I've paid them $8k thoughout my paychecks, I would get a refund of $1k at the end of the year. But since my tax liability is $7k, I can apply the hybrid "credit" of $1950 (for my MMH) and get an additional $1950 on top of my $1k.
It's rare to get your tax refund that equals your entire tax liability. But if you did, then the credit does not get you anything, as you mentioned on the first line, because it means "you dont OWE taxes".
HOWEVER, the one drawback to a tax credit is that you can't use it if you don't OWE taxes. And tax credits are one of the last things that are applied when filling out your tax return. So, if you end up with a tax refund, you can't then apply the tax credit to get MORE of a refund. You simply can't claim the credit. Even if you end up owing taxes, but owe less than the amount of your credit, you can't use the full amount of your credit.
[/QUOTE]
Scott, I agree with you on all your points except the above paragraph. Actually, not the entire paragraph, just the part that starts with "So, if you end up with a tax refund..."
If you end up with a tax refund, you CAN apply the credit to get MORE of a refund IFF your refund is not your entire tax liabiliity. For example, if I owe the IRS $7k in taxes, but I've paid them $8k thoughout my paychecks, I would get a refund of $1k at the end of the year. But since my tax liability is $7k, I can apply the hybrid "credit" of $1950 (for my MMH) and get an additional $1950 on top of my $1k.
It's rare to get your tax refund that equals your entire tax liability. But if you did, then the credit does not get you anything, as you mentioned on the first line, because it means "you dont OWE taxes".
Last edited by occ; 08-22-2006 at 03:48 PM.
#13
08-22-2006, 08:06 PM
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Re: Tax Credit for 05 FEH
Walt and others... the web page sited below is outdated and INVALID.
Please disregard that information. That information expired Dec. 31, 2005.
"The $500 deduction for purchases in 2006" never ever went into effect for a single soul, as the law changed before 2006 arrived.
Please disregard that information. That information expired Dec. 31, 2005.
"The $500 deduction for purchases in 2006" never ever went into effect for a single soul, as the law changed before 2006 arrived.
Originally Posted by WaltPA
Here is what I found on the IRS website about buying a 2005 FEH in 2006 ...
"The deduction will be limited to $500 for vehicles placed in service in 2006 and no deduction will be allowed after that year."
Note, this is for the older "deduction", and not the newer "credit" that applies to 2006 and 2007 models.
Some how, when it comes to Federal income taxes, I think the IRS's opinion trumps Ford.
"The deduction will be limited to $500 for vehicles placed in service in 2006 and no deduction will be allowed after that year."
Note, this is for the older "deduction", and not the newer "credit" that applies to 2006 and 2007 models.
Some how, when it comes to Federal income taxes, I think the IRS's opinion trumps Ford.
#14
08-23-2006, 02:12 PM
Re: Tax Credit for 05 FEH
Bunny, at the moment you rule the '05 Tax Credit/whatever roost. I also bought a new '05 this year. I've called Ford, e-mailed Ford, replied to Ford surveys, spoken with very nice Ford customer reps and spent a half hour on the telephone with a friendly man from the IRS. And what I was told is the '05 didn't currently qualify. But that was weeks ago. Perhaps your letter galvanized Ford into action - or at least helped. Anyway, that's great news for all of us '05-in-'06 FEH owners. Thanks.
#15
08-23-2006, 03:19 PM
Re: Tax Credit for 05 FEH
Well, I have to say I am quite excited about the whole deal. I sent a letter to customer service and the board of directors. I am feeling somewhat of an urge to post his name and phone number here just so others can confirm what he is saying is true. Why would he give his name and direct line if he didn't want me ( and a few others) to call him right? He also states "please feel free to contact me with any other concerns relating to your vehicle's certification" I am willing to post it if others feel it is appropriate...
#16
08-23-2006, 07:04 PM
Re: Tax Credit for 05 FEH
Originally Posted by bunny
Well, I have to say I am quite excited about the whole deal. I sent a letter to customer service and the board of directors. I am feeling somewhat of an urge to post his name and phone number here just so others can confirm what he is saying is true. Why would he give his name and direct line if he didn't want me ( and a few others) to call him right? He also states "please feel free to contact me with any other concerns relating to your vehicle's certification" I am willing to post it if others feel it is appropriate...
#17
08-25-2006, 08:21 AM
Re: Tax Credit for 05 FEH
Bunny,
Let me also add my thanks at a "new 05 purchased in 06" owner. I emailed their "customer service" (and I use the term loosely), and got absolutely nothing useful, and haven't had the time to pursue it further. This is great news for those of us in this unique situation.
Let me also add my thanks at a "new 05 purchased in 06" owner. I emailed their "customer service" (and I use the term loosely), and got absolutely nothing useful, and haven't had the time to pursue it further. This is great news for those of us in this unique situation.
#18
10-20-2006, 01:19 PM
Re: Tax Credit for 05 FEH
Good news for 2006 '05 purchasers.
Issue Number: IR-2006-165
Inside This Issue
Additional Ford Hybrid Vehicles Certified for Tax Credit
IR-2006-165, Oct. 20, 2006
WASHINGTON — The Internal Revenue Service has acknowledged the certification by Ford Motor Company that two of its 2005 vehicles meet the requirements of the Alternative Motor Vehicle Credit as qualified hybrid motor vehicles. The tax credit for hybrid vehicles applies to vehicles purchased on or after January 1, 2006.
The hybrid vehicle certifications recently acknowledged by the IRS and their credit amounts are:
• Ford Escape 2 WD Hybrid Model Year 2005 $2,600
• Ford Escape 4 WD Hybrid Model Year 2005 $1,950
The 2006 Model Year Ford Escape Hybrid front wheel drive and 4 WD models previously were certified in the amounts of $2,600 and $1,950 respectively.
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 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 percent of the credit. For the fourth and fifth calendar quarters, taxpayers may claim 25 percent of the credit. No credit is allowed after the fifth quarter.
The total number of qualifying Ford hybrid vehicles reported sold as of June 30, 2006, was 11,885. Therefore, purchasers of Ford’s qualified vehicles may continue to rely on the previously issued IRS certifications under Notice 2006-9 concerning the vehicle’s qualification for the credit.
More information on hybrid vehicles and other alternative motor vehicles can be found on the IRS web site.
Issue Number: IR-2006-165
Inside This Issue
Additional Ford Hybrid Vehicles Certified for Tax Credit
IR-2006-165, Oct. 20, 2006
WASHINGTON — The Internal Revenue Service has acknowledged the certification by Ford Motor Company that two of its 2005 vehicles meet the requirements of the Alternative Motor Vehicle Credit as qualified hybrid motor vehicles. The tax credit for hybrid vehicles applies to vehicles purchased on or after January 1, 2006.
The hybrid vehicle certifications recently acknowledged by the IRS and their credit amounts are:
• Ford Escape 2 WD Hybrid Model Year 2005 $2,600
• Ford Escape 4 WD Hybrid Model Year 2005 $1,950
The 2006 Model Year Ford Escape Hybrid front wheel drive and 4 WD models previously were certified in the amounts of $2,600 and $1,950 respectively.
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 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 percent of the credit. For the fourth and fifth calendar quarters, taxpayers may claim 25 percent of the credit. No credit is allowed after the fifth quarter.
The total number of qualifying Ford hybrid vehicles reported sold as of June 30, 2006, was 11,885. Therefore, purchasers of Ford’s qualified vehicles may continue to rely on the previously issued IRS certifications under Notice 2006-9 concerning the vehicle’s qualification for the credit.
More information on hybrid vehicles and other alternative motor vehicles can be found on the IRS web site.
