I bought a FEH on Sept. 21 and two week later I was hit by another driver and rolled so it was totaled(had 437 miles on it). On Oct. 17 I went to the same dealer and bought another one just like the wrecked one. Am I able to claim both on my taxes and get two refunds? And do you know what the refunds would be?

See picture of my wrecked one here: http://picasaweb.google.com/fastford...tSoGreatEscape

 

Wow - glad to see you came out ok - it looks like they are making them a bit stronger than they used to - no roof cave in.

I believe there is a minimum time period that you need to keep the vehicle in order for the tax credit to be claimed, or when you claim it you still must own the vehicle - in any case I do not believe you can claim both.

 

Disclaimer - Don't rely on this as tax advice, talk to your tax professional in regards to your particular situation.

I am not aware of any recapture rules pertaining to Hybrids. The Secretary has reserved the right to create them however. If I were to use the same rules for Electric vehicles, a casualty loss is not a recapture event. So I would say that you can claim both.

Ironically, you may not even qualify for the available credit on the first one. To clarify, the credit is a NON-refundable credit subject to AMT.

 

I have a local tax preparer do my taxes each year so I'm not familiar with the AMT. I file single itemized, with 2 mortgages (one live in and a rental house) My gross salary with rental income is around 65,000.00.

 

Don't rely on the credit until your taxes are done. You could end up with all or very little.

 

IRS publication 17 (chapter 37) now includes language that you must recapture the credit if the vehicle no longer qualifies. Not sure but it seems safe to assume that no longer owning a vehicle means it no longer qualifies. It's possible, but not likely, that the ownership transfer to the insurance company could have included the required tax disclosure described on form 8910.

I'm not a tax person, but I personally would not try to claim a credit for property acquired and subsequently transferred within the same tax year. I suppose there could be some tax benefit available for the loss, but I'm pretty sure a car accident does not fall under those rules.

 

It used to say you can claim the tax credit now, but you must keep the car 3 years. If you sell the car after 1 year, you pay 2/3 credit back.
If you sell the car after 2 years, you pay 1/3 credit back.

IRS figures nearly all people would keep the car 3 years.
But, this is basically based on the honor system.
( and the occasional audit! )

But I have not re-read the laws recently, as I have not bought a hybrid recently. Check for state incentives also. My state incentive was better than the IRS one, and has nothing to do with AMT.

 

Be careful how you read these things. A vehicle that is no longer a qualifying hybrid (i.e. a hybrid modified for racing) is not the same as an original purchaser that is no longer in possession of the vehicle.

 

I would think that you can claim both. You did not buy the first to resell it and just get the tax credit, and you bought the second for your personal use. So I would personally try.

 

I just called the 800 number for the IRS and asked them the same question. He said he didn't know the anwser and would have to get back with me within next 15 days.