DO NOT BUY THE CAR IF THE TAX BREAK IS A MAKE OR BREAK PART OF THE DEAL!
Unless someone can straighten out my taxes I am very unhappy with the tax break scam. When I purchased the car it said $2000 off, of course when I went it and tried to finance 2k less they informed me it was an IRS thing and I would get it when I filed my taxes.
Well my taxes are done and when I added the hybrid break in it changed my return by $32 not $2000. Tell me how it can be advertised and touted as $2000 off with actually only being $32.
Anyone????
Clif

BTW I will have to confirm the exact amount I am at work but $32 is pretty close to being the correct #. Key thing to keep in mind is it wasn't $2000, which was a make or break thing for me. Figured I would pay the 2k then and get it back later so it would be OK, turns out I was wrong.

 

You're tax deduction for '05 is just that. It's not $2000 back to you. For '06, new hybrid purchase get you a tax credit.

 

Yeah the tax deduction for 05 wasn't the impressive. The 3150 tax credit for 06 is a lot better. The 05 deducts your overall inccome by 2000 (so should be worth around 20-30% right? 32 dollars seems low), the 06 tax credit is deductet directly from your taxes so most people should get that credit (as long as you pay at least that amount to the feds). I might be wrong. I barley understand this tax system

 

Geez, my $2000 deduction on my 2004 taxes netted me a $560 tax break.

Something is wrong with your calculations, either that or you are in the 0 percent tax bracket.

 

Thing is unless it gives me $2000 back then I was duped by the dealer, that is what I was told I would get was $2000 off. Then when I questioned it I was told no you will get it back at the end of the year, not get $2000 off my income. I am stopping by on the way home today to give them an earful.

Clif

 

so, the lesson that has been learned is:

Don't listen to a car dealer when it comes to your taxes.

 

Sorry Clif. Sounds like you were deceived by the dealership (not a surprise). A tax deduction (an amount subtracted from your taxable income) is different from a tax credit (an amount you get back).

 

Hey, I wouldn't get to upset with the dealer. When I got my 03 my tax guy didn't even know how to do it, or what it was worth. I doubt the dealer was being deceptive. He probably just gave misinformation which he probably thought was correct. Maybe you should have asked the question here before you bought the car, or gone to an authorative source that would know for sure.

The tax credit ONLY covers cars sold after 1/1/06. All cars prior to that get a deduction. And these only apply if you are the first owner.

I would calm down a bit and wouldn't bother going to the dealership. It will serve no purpose unless you just want to inform him that he was wrong.

$32 back on your taxes seems pretty low it should be much higher than that.

 

The exception is if you are stuck paying Alternative Minimum Tax; as it stands now you lose the $2100 (or whatever if it is a different hybrid) . Talk to your tax consultant now for the 2006 deduction; he/she can help you figure out how to avoid (AMT)- basically maximize income, minimize deductions .

 

the tax credit is not bogus

the tax deduction was not bogus

the tax deduction should have reduced your taxable income by $2000 (at 28% tax rate, that'd save you $560 on taxes - at 15%, only $300)

I haven't talked to a dealer lately (in the last 20 years) that knows more about a car that I want to talk about than I do. I was told not long ago by a local Honda dealer that the CVT was a normal automatic transmission. I walked into a Subaru dealer and talked about the SVX and the young salesguy had never heard of one - said try another, he was a 'car guy' (doh?! what are the 'other' CAR sales personnel?). I had a relative who is the financing manager, and in his words, car expert, tell me how the older Corvette's (before 2005) had a 5.0L engine. I could go on and on. So, if you can't trust them on the ONE subject they SHOULD know something about (their own make of cars, much less the competition) why or how would they know anything about taxes?

I tried to convince a local Honda saleslady that the $2000 in '05 was a deduction, in '06 it'd be a credit, etc. She couldn't figure it out - but she WAS convinced I'd save $2000 if I bought by 12/31/05. That was about 12/28/05.
Ignorance runs rampant in the car showrooms of America. Some sales people do know what they are talking about, but I've learned they are the exception, not the rule.