Shocked at how low the Prius Plugin resale value is, watch out!

I'm a little confused.
1. In thought the tax credit was only 2500.00 for the pip. "not" 7500.00 as it is for full electrics?
Or is it 2500.00 for the regular Prius and 7500.00 for the pip?

2. Didn't think tax liability mattered for "credits" only rebates and write offs?

This is why people with lots of kids actually get tax checks from the government when they haven't paid in due to the child tax credit.

Edit...
Tax Credits

While tax deductions work by lowering taxable income, tax credits are a direct reduction of the tax due. After you figure out your taxable income and subtract your deductions, you calculate your tax due. You still have a chance to reduce that amount, often significantly, by taking advantage of any allowable tax credits.

Refundable Tax Credits Refundable tax credits are the ones that are easiest to embrace, because they have fewer restrictions and limitations. You can benefit from a refundable tax credit even if you have no tax liability and no withholding. There are several credits in this category, including the earned income credit (EIC) and the adoption expense credit. The EIC, which is available to low income filers, can provide you with a refund of several thousand dollars.

The prius tax credit is obviously a non refundable credit meaning limited to your total tax liability.

I know clear as mud right?


Alan...
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The additional $7500 mentioned above is in the state of West Virginia.

The PiP qualifies for a $2500 federal income tax credit, but it can only be taken in the year of purchase and does not carry over to other years. If you don't have $2500 or more of federal income tax liability, you will not be able to claim the entire credit.

 

Am I the only one not understanding this thread? The car costs $25k to $26k to purchase new not counting TTL. That's how much it cost to buy new today. You were offered $23k by a dealer. Sounds like excellent resale value to me for a car with 7500 miles. The dealer will mark it up at least $1k or so for sale and I wouldn't buy a used car for $1000 less than new so I think that's on the high side. Unless you were an early adopter which of course you pay extra for, this is good news. I bought the base PiP for $25.8k and it's worth some $24k private sale right now? Damm good resale value.

 

Cars depreciate the most in year one. My gen 3 IV w solar dropped like 6 K. Than just 1.5K per year thereafter. I think the sweet spot in about 3 years.

 

If the car is new and with so many people losing cars in Sandy, you may be able to sell it private party through Auto Trader or some other similar service for a better deal and quickly. The dealer is trying to make a profit so cut him out and keep the money. I believe the warranty is transferable which provides peace of mind for the buyer. Invite them to have the dealer inspect the car.

 

If there is one thing I learned this year, it's that I will never trade in a car again. I tried selling my car via craigslist (had various issues), and I still got a lot more than what the dealer was going to give me (they were going to scrap it). I recommended this to a coworker, and he sold his car via craigslist right away as well.

So try Craigslist and see what kind of responses you get.

 

So list is $32,000 - $2500 tax cred = $29,500 - $4,000 incentives = $25,500 - $23,000 trade-in = $2,500 difference... and you're complaining???

 

2500.00 bucks to drive 7500.00 miles in a virgin car.

Someone asked what color, did I miss that?

Alan...
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They purchased in July, the $4,000 rebate was not available then. So, it is more like $6,500 to drive 7,500 miles. With the recent large rebates I would be unhappy also. I guess that is what happens when you are an early adopter. You can not tell if or when rebates are going to be given. I think everybody was thinking there was going to be a demand for the PIP. But, there wasn't and I think Toyota realized that and had to give rebates to sell them.

 

Exactly lots of people are thinking subconsciously what we're discussing openly.

Too many people have very long commutes... All the high populous areas are big cities... Hence long commutes.

That leaves a narrow margin of the market to benefit.

They say. it takes 5 years from conception to when it hits the streets... They didn't anticipate t+e competition either.

Alan...
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demand plays big factor as well.
dealers know they still can't move PiPs well in NY/NJ with the huge incentive, carrying 'used' PiP might not look attractive to them.

 

This makes sense. Sell it private party see if you get any bites. Try another dealer maybe you caught them on a bad day with cash flow problem or too much used inventory.

 

I do love leather, all my cars have it.

Alan...
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Correct me if I am wrong, but when you lease it the max federal tax credit is taken out already. Meaning your car price is $2,500 less with the lease price.

 

Traditional IRA => Roth IRA is a great way to convert taxable money into tax-free. Or if you need some "income" to take advantage of a tax credit. I've done it the past few years. And you can "recharacterize" the transfer anytime up to when you file your taxes.

Example: in 2012 move $5,000 from a traditional IRA to a Roth IRA. After figuring out your 2012 taxes in 2013, you find that it would have been better to just move $4000. No problem - just transfer $1000 back from the Roth to the traditional, describing it as a recharacterization.

Be sure to keep all the paperwork from the transfers. I had to explain it all again to the IRS on 2 of 3 times that I did it. They accepted the explanation, but the recharacterization reports didn't automatically get matched up with the original transfers.

I know that money is just magnetic patterns on hard disks. Apparently time is as well (you can change your 2012 income by "recharacterization" in 2013).

 

The leasing company is allowed to claim the federal tax credit, not required. Typically the lease terms reflect the federal tax credit in a combination of "capital cost reductions", lower "rent", adjusted residual, or some combination of all three.

Most leasing companies (banks), like Toyota Financial Services, Ally Bank, and USABank seem to be kicking back somewhere between 60% and 90% of the federal tax credit into the lease terms, hence why you see some very attractive monthly lease rates.

For folks who don't have a current year tax liability, this is a pretty effective mechanism to indirectly capture the tax credit.

 

It's a long shot, but you might be able to get some of the $4k worth of new incentives taken off your residual, making buyout of your PiP more in line with the market price. If they don't reduce the residual, then you will most likely just turn the vehicle in at the end of the lease and they would have to reduce the residual to market AND take on the cost of reselling the vehicle.

You also have the option of selling your lease.


2012 Toyota Prius Plug-in Hybrid Lease - Lease a Toyota Prius for $349.00 per month - Silver Spring, Maryland 20910 - 2012 Toyota Prius Lease - Toyota Prius Lease - 2012 Toyota Prius Lease Special - Lease Promotion on Toyota Lease

 

I hear that complaint a lot on the base plug in. Toyota should have upgraded the seats. Many things make a great car and good comfortable seats is one of them. If you spend a lot of time in your car comfort stands front and center in user experience. At that price point good seats should be a priority. What could be more frustrating than spending money on seats after buying a new car.

 

I agree. Clazzio is shipping my leather seat covers this week so hopefully they will help make the seats more comfortable. For as little as $275 it could be an option for those who went with the Base model.