Used Prius & Clean Fuel Tax Deduction

[gabriel]

Does anyone know if the Clean Fuel Deduction only applies to newly purchased Priuses? That's what I get from reading the information about that tax deduction. Why wouldn't this apply to used Priuses?

[tag]

Why wouldn't this apply to used Priuses?

Because the legislature says so:

© Qualified clean-fuel vehicle property defined
For purposes of this section -
(1)In general
The term ''qualified clean-fuel vehicle property'' means property which is acquired for use by the taxpayer and not for resale, the original use of which commences with the taxpayer....

It's really as simple as that.

[gabriel]

I don't see any wording in that which leads me to believe "does not apply to used vehicles." Seriously, if the whole point of the deduction is to make it an incentive/reward for people purchasing environmentally friendly vehicles, why wouldn't it apply to ALL of them? I purchased my certified used Prius to drive it around, not to resell it.

[tag]

I don't see any wording in that which leads me to believe "does not apply to used vehicles."

Not even this wording?:

the original use of which commences with the taxpayer

[tag]

Seriously, if the whole point of the deduction is to make it an incentive/reward for people purchasing environmentally friendly vehicles, why wouldn't it apply to ALL of them?

Don't get me wrong. I happen to agree with you wholeheartedly; I think the deduction should apply to all (new and used) as well.

I was merely pointing out that the decision was made by the legislature, for whatever reason, that the deduction be allowed only for "original use" vehicles.

[gabriel]

<div class='quotetop'>QUOTE(tag\";p=\"62543)</div>

<div class='quotetop'>QUOTE(gabriel\";p=\"62535)

I don't see any wording in that which leads me to believe \"does not apply to used vehicles.\"[/b]

Not even this wording?:

the original use of which commences with the taxpayer
[/b][/quote]

Uh, yeah, that'd do it. Heh.

[aforkosh]

The fact that only the original owner gets an adjustment is proper and fair. The basic principle is that only one credit is available per car. If this were not true, I could get quite a scam going by purchasing Prii and then reselling them at my cost and taking the $2000 adjustment. This wouldn't encourage use of the car, but only trading of it.

[tag]

As for "trading Prii", that's been thoroughly covered by the acquired for use by the taxpayer and not for resale language. If you were purchasing and selling these things continually, you'd wind up with tens of thousands of dollars worth of deductions on your 1040 and, eventually, one of the least well-received letters in human history.

One credit per car is the policy, no doubt about that. I'm just not convinced it's proper and fair. After all, commercial buildings are bought and sold continually (as are myriad types of machinery and equipment) and each time the new owner is allowed to take depreciation deductions despite the fact that the seller had been doing the same thing for years. The recovery period starts all over again when the depreciable item is purchased. I don't know why the same principle couldn't be applied to qualifying hybrid vehicles.