• Skip to main content
  • Skip to primary sidebar

Auto Trends Magazine

Car reviews, industry news, & advice.

Archives for March 5, 2013

Income Tax Breaks and Your Hybrid Car

March 5, 2013 by admin 6 Comments

It happens. You purchase a new car and wonder if there is a tax break or incentive offered. Here on Auto Trends, we are frequently asked if certain vehicles qualify for a tax rebate or a tax credit, including hybrid electric vehicles.

Nissan LEAF

Nissan LEAF buyers can seek a $7,500 tax credit.

Tax Incentives

Federal tax incentives are offered and do include a select group of hybrids, namely of the plug-in hybrid electric vehicle kind. A federal tax credit of up to $3,400 was previously available for standard hybrid models such as the Toyota Prius, Honda Insight and the Ford Fusion Hybrid, but those tax breaks were phased out and eliminated after December 31, 2010.

Today’s tax breaks for fuel efficient vehicles cover plug-in hybrid electric vehicles (PHEVs) and battery electric vehicles (BEVs). A full credit of $7,500 is offered, but that amount can come in lower based on a vehicle’s battery charging capacity.

Mitsubishi i-MiEVFor BEVs, that means a $7,500 vehicle credit. For PHEVs, the amount varies although the first PHEV, the Chevrolet Volt, can garner a $7,500 tax credit for buyers.

Propulsion Energy

To understand how the IRS determines the credit, a read up on the Plug-In Electric Drive Vehicle Credit (IRC 30D) is necessary. Specifically, the current law covers those vehicles acquired after Dec. 31, 2009. The IRS states that, “the credit is equal to $2,500 plus, for a vehicle which draws propulsion energy from a battery with at least 5 kilowatt hours of capacity, $417, plus an additional $417 for each kilowatt hour of battery capacity in excess of 5 kilowatt hours. The total amount of the credit allowed for a vehicle is limited to $7,500.”

Clear as mud, right?

Fortunately, the EPA publishes tax credit information on its website revealing that there are (as of publication) few cars that currently qualify. And, of those vehicles listed, the tax credit ranges from the base $2,500 to the maximum $7,500.

IRS Form 8834

Buyers of the Chevrolet Volt and Fisker Karma score a $7,500 tax credit while the incentive for Toyota Prius PHEV buyers is $2,500. The only other two models qualifying for a tax break are the Ford C-MAX Energi and the Ford Fusion Energi. Buyers of those vehicles can receive a tax break of up to $3,751.

2013 Ford Fusion Energi

Tax Breaks

You should also know that the incentive for qualifying vehicles is a tax credit. A tax credit reduces your tax balance due while a tax rebate gives you money back regardless of whether you owe money or not.

So, if you owe the IRS $8,000 this year and bought a Chevrolet Volt, you will send the IRS $500 ($8,000 minus the $7,500 credit = $500) at tax time. If you owe the IRS less than the tax credit, the balance of the credit rolls over to the next tax year. You will need to fill out IRS Form 8834 — Qualified Plug-In Electric and Electric Vehicle Credit — and attach it to your tax return to receive the credit.

State Tax Credits

Besides federal help, taxpayers in some states may qualify for additional incentives. In California, tax breaksfor fuel-efficient vehicles include both categories mentioned here plus fuel-cell electric vehicles.

Incentives and other tax breaks for your area are listed on the Plug In America website.

Filed Under: Special Tagged With: Chevrolet Volt, Ford Fusion Energi, hybrid car, income tax, IRS, Nissan LEAF, tax breaks, tax credit

Primary Sidebar

Recent Posts

  • A Look Back at the Chevrolet Monza
  • The Best Ways to Care for Your Tires
  • Contrary to the Latest Rumors, the Ram Dakota Will Return (Maybe)
  • Highlights of the 2021 Cadillac CT4
  • What is Bidirectional Charging?

Recent Comments

  • Winter Prep: Replace Your Worn Out Tires — Auto Trends Magazine on The Best Ways to Care for Your Tires
  • Hot Tips to Keep Your Tires Cool This Summer — Auto Trends Magazine on The Best Ways to Care for Your Tires
  • Your Tires: Air Pressure & Care Tips — Auto Trends Magazine on The Best Ways to Care for Your Tires
  • 5 Forgettable Cars From the 1970s — Auto Trends Magazine on A Look Back at the Chevrolet Monza
  • About the Fox-Body Ford Mustang — Auto Trends Magazine on A Look Back at the Chevrolet Monza

Archives

  • March 2021
  • February 2021
  • January 2021
  • December 2020
  • November 2020
  • October 2020
  • September 2020
  • August 2020
  • July 2020
  • June 2020
  • May 2020
  • April 2020
  • March 2020
  • February 2020
  • January 2020
  • December 2019
  • November 2019
  • October 2019
  • September 2019
  • August 2019
  • July 2019
  • June 2019
  • May 2019
  • April 2019
  • March 2019
  • February 2019
  • January 2019
  • December 2018
  • November 2018
  • October 2018
  • September 2018
  • August 2018
  • July 2018
  • June 2018
  • May 2018
  • April 2018
  • March 2018
  • February 2018
  • January 2018
  • December 2017
  • November 2017
  • October 2017
  • September 2017
  • August 2017
  • July 2017
  • June 2017
  • May 2017
  • April 2017
  • March 2017
  • February 2017
  • January 2017
  • December 2016
  • November 2016
  • October 2016
  • September 2016
  • August 2016
  • July 2016
  • June 2016
  • May 2016
  • April 2016
  • March 2016
  • February 2016
  • January 2016
  • December 2015
  • November 2015
  • October 2015
  • September 2015
  • August 2015
  • July 2015
  • June 2015
  • May 2015
  • April 2015
  • March 2015
  • February 2015
  • January 2015
  • December 2014
  • November 2014
  • October 2014
  • September 2014
  • August 2014
  • July 2014
  • June 2014
  • May 2014
  • April 2014
  • March 2014
  • February 2014
  • January 2014
  • December 2013
  • November 2013
  • October 2013
  • September 2013
  • August 2013
  • July 2013
  • June 2013
  • May 2013
  • April 2013
  • March 2013
  • February 2013
  • January 2013
  • December 2012
  • November 2012
  • October 2012
  • September 2012
  • August 2012
  • July 2012
  • June 2012
  • May 2012
  • April 2012
  • March 2012
  • February 2012
  • January 2012
  • December 2011
  • November 2011
  • October 2011
  • September 2011
  • August 2011
  • July 2011
  • June 2011
  • May 2011
  • April 2011
  • March 2011
  • February 2011
  • January 2011
  • December 2010
  • November 2010
  • October 2010
  • September 2010
  • August 2010
  • July 2010
  • June 2010
  • May 2010
  • April 2010
  • March 2010
  • February 2010
  • January 2010
  • December 2009
  • November 2009
  • October 2009
  • September 2009
  • August 2009
  • July 2009
  • June 2009
  • May 2009
  • April 2009
  • March 2009
  • February 2009
  • January 2009
  • December 2008
  • November 2008
  • October 2008
  • September 2008
  • August 2008
  • July 2008
  • June 2008
  • May 2008
  • April 2008

Categories

  • Auto Parts
  • Auto Shows
  • Automotive Career
  • Automotive News
  • Book Reviews
  • Car Tips
  • Classics & Discontinued Models
  • Commentary
  • Commercial Vehicles
  • Concept Vehicles
  • Dealers
  • Engineering & Technology
  • Fleet
  • Fun News
  • Maintenance & Repairs
  • Motorsport
  • New Models
  • New Vehicle Reviews
  • Ownership Experience
  • Product Reviews
  • Special
  • Specifications

Meta

  • Log in
  • Entries feed
  • Comments feed
  • WordPress.org

New!
Check out our Jobs Board!

via GIPHY

Subscribe to Auto Trends

Subscribe in a reader

Social Media

Visit our social media pages:
Facebook
Twitter
Google+
Pinterest

Where is Matt Currently Published?

The Carolinian (new car reviews)
NAPA Know How Blog
On the Road Again

Pages

  • About
  • Authors List
  • Automotive Brochures
  • Contact
  • Industry Jobs
  • Write
    • Style Guide

Categories

Recent Posts

  • A Look Back at the Chevrolet Monza
  • The Best Ways to Care for Your Tires
  • Contrary to the Latest Rumors, the Ram Dakota Will Return (Maybe)
  • Highlights of the 2021 Cadillac CT4
  • What is Bidirectional Charging?
  • A Look Back at the Ford Mustang II
  • New Duck-Billed Post Office Trucks Has Some People Quacking
  • Vroom! Lexus Reveals the IS 500 F Sport.
  • Introducing the Kia Carnival MPV
  • Goodyear, Cooper Tire to Join Forces
  • Highlights of the 2021 Nissan Rogue
  • 7 Facts About the 2022 Chevrolet Bolt
  • Introducing the All-New
    2022 Mitsubishi Outlander SUV
  • What’s the Future for Chrysler and Dodge Under Stellantis?
  • All About Sobriety Checkpoints
  • Plug It In: Toyota RAV4 Prime
  • About the Volkswagen Taos
  • All-Wheel Drive Finally Comes to the Toyota Camry and We Like It!
  • Growing EV Industry Leaves Countries and Businesses Racing to Meet Increasing Lithium Demand
  • Introducing the All-New 2022 Nissan Pathfinder Crossover SUV
  • At Last! The All-New 2022 Nissan Frontier Revealed.
  • In Photos: 2021 Ford F-150 Raptor!
  • Cadillac V-Series Blackwing Preview!
  • Cost-Effective Crossover: Nissan Kicks
  • 10 Spring Cleaning Tips for Your Car
  • All-New Acura TLX Takes Charge
  • The Golden Years: 6 Memorable Models From the Original Era of Muscle Cars
  • From Datsun to Nissan: 40th Anniversary of the Maxima Sedan
  • The Mazda CX-5 Brings a Premium Touch to the Compact Crossover Utility Vehicle Segment
  • 4 Car Upholstery Cleaning Tips
  • The 14 Brands of Stellantis
  • Peugeot May Not Return to the U.S. Market After All
  • Next-Generation Sedona Minivan Will Be Renamed the Kia Carnival
  • GM Launches BrightDrop, Its Commercial EV Brand
  • The Refreshed and Handsome
    Lexus IS 350 F Sport
  • What We Know About the All-New 2021 Jeep Grand Cherokee L
  • The All-New and Formidable 2021 Nissan Rogue Crossover
  • Fuel-Efficiency and AWD Champion: 2021 Toyota RAV4 Hybrid
  • Midsize Performance Master: 2021 Hyundai Sonata N-Line
  • Performance Hatchback: The All-New 2021 Mazda Mazda3 Turbo!
  • NACTOY Finalists For 2021 Offer Familiar and Futuristic Choices
  • Super Trooper: Nissan Titan Pickup
  • Behind the Wheel of the Popular 2021 Toyota Corolla Sedan
  • Lucid Motors Completes Arizona Factory
  • A Robust Turbodiesel Comes to the Chevrolet Silverado 1500
  • Mid-Engine Masterpiece: The Eighth-Generation Chevrolet Corvette Stingray
  • Compact Performance:
    2021 Cadillac CT4-V
  • All-Wheel Drive Supplies the Nissan Altima With a Competitive Edge
  • Return of the Toyota Venza!
  • Lexus Brings a Convertible to the Gorgeous LC 500 Line
March 2013
S M T W T F S
 12
3456789
10111213141516
17181920212223
24252627282930
31  
« Feb   Apr »

Copyright © 2021 · News Pro on Genesis Framework · WordPress · Log in