The Hybrid-car Tax Credit Challenge
Aug. 09, 2006: Bankrate</SPAN>

Summary: Toyota hybrid vehicle fans, circle Sept. 30 in red on your calendars.

That's the day you must drive one of these fuel-efficient autos off a Toyota lot or give up half of the new tax break created to reward energy-conscious motorists.

Thanks to the Energy Policy Act of 2005, drivers who trade their gasoline-only autos for cleaner-running hybrid vehicles now get a tax credit instead of a tax deduction. That's a welcome change, since a credit produces dollar-for-dollar tax savings.

But some of the law's other automotive tax components are not quite as appealing.

 

Wallpad,

Good thing you double checked. Would not have been fun to get to tax time and find your $1300 behind where you thought you'd be.

 

When I bought my TCH, the sales contract listed the car as 2007 Camry. Nowhere on the sales agreement or other paperwork did it say "Hybrid." I told the finance manager that I needed the paperwork to state that I was purchasing a hybrid model, for the tax credit. He said the computer would not allow them to add that information. He called in the sales manager, who agreed. He said all he could do was handwrite the model on the purchase agreement (so he wrote in "HYBRED"). The sales manager also said that the VIN includes a code that indicates the car is a Camry Hybrid. I also wrote "Camry Hybrid" on my check. In any event, I have a Camry Hybrid in the garage, a Camry Hybrid owner's manual and insurance declarations covering a Camry Hybrid, so I am not too worried about establishing entitlement to the tax credit.

RoLev

 

One thing I don't understand is if the 60k is reached, do you still get the tax credit or not? What if you get the car before sept 30th and they have already reached the 60k which is seems has already happend, do you get the credit?

 

Hi ccobb258. The full tax credit is allowed if you buy your car before the end of the quarter following the quarter in which the limit is reached. So for Toyota, they reached the limit in the 2nd quarter, so the tax credit is good through the 3rd quarter (9/30).

 

One of the identifiers for the certification is the VIN of the vehicle.

Here's the Cert.. In it will be the VIN range which will match yours, keep a copy for your records

http://a230.g.akamai.net/7/230/2320/...ybrid_my07.pdf

This is from the Toyota web site.

 

The VIN numbers they are referring to are for the TCH itself only, not ones that qualify for the tax credit. The VIN alone cannot be used to determine eligibility for the tax credit.
-Scott

 

Scott - In addition to the VIN, what else is needed? A copy of the sales contract that pairs the VIN with the "in-service/purchase" date? BTW, my contract, like Rolev, only includes the generic "2007 Camry" for the model w/o mentioning the hybrid.

 

I looked at form 8910 and can't find anything about this. I'm thinking it's like most items with the IRS. You put in for the deduction without submitting proof you're entitled. If you're audited though you'd better make sure your car qualifies and you have the paperwork (sales order, registration, etc.) that shows the credit is valid.

 

It might also be a good idea to print out and keep a copy of the "IRS Certification Letter Camry Hybrid Model Year 2007" that can be found on Toyota's web site. The PDF file is here: http://a230.g.akamai.net/7/230/2320/...ybrid_my07.pdf

Oops, nomorebenz has already posted this same link ... never mind.