Another Federal Tax Credit question for 2018 buyers

Congress can pass any legislation it wants. When the President signs it, it becomes law. There is always a chance a tax credit can be repealed but I can't remember an instance when one was repealed during a current tax year.

 

The most recent threat to the credit at the end of last year was consistent with that, they were considering ending the credit but only for purchases after December 31st 2017. I won't be too surprised if the same thing happens again later this year and they try and end the credit for purchases after December 31st 2018. Then again if they are really feeling could their oats they could repeal it even for 2018, however that seems far less likely.

 

Talk about screwball legilators

 

Plug-in Amercia has launched an effort to *extend* the credits, which I think is probably the more likely outcome.

I am not aware of any effort to curtail the credits, and the prior attempt was not a very serious threat. Keep in mind the Repubs are generally "all of the above" and Dems would mandate 100% plug-ins, so on average Plug-ins are on terra firma.

Basically, things like ethanol mandate and plug-ins, though we can try to argue eco-benefits, there is no doubt they create jobs.

 

does anyone know if toyota is near the phase out amount? Or anything regarding the tax credit being gone? Planning to purchase a Prime, but am hoping I can get the $4,500 next year when I do my taxes!

 

I just bought a 2018 Prius 4. Can I get a tax credit?

 

The federal tax credit is only for the Prime. There used to be a credit for all hybrids but that was over ten years ago. The current credit is only for electric vehicles and plug-in hybrids.

 

Only in local situations, most notably Wash DC exempts sales tax for all vehciles exceeding 40 EPA CITY I believe.

 

Plug In Electric Vehicle Credit IRC 30 and IRC 30D | Internal Revenue Service
30D New Qualified Plug in Electric Drive Motor Vehicles Toyota Motor Sales USA Inc | Internal Revenue Service
Forms and Publications (PDF)

A couple of things worth repeating:
--This is a credit against the tax you owe. If you owe $4502 or more in tax for 2018, you get this credit against that tax liability. If you owe less, you get less. This isn't how big a check you write on April 15, 2019, this is for the full tax amount you accrue over 2018; you might get all this in a refund check if the tax on your income had been fully withheld. You can get an idea from your 2017 form 1040--look on line 47 for the total tax. This credit would go on line 54. The 2018 forms might be different but probably similar.
--Congress can change anything any time.
--This credit applies whether you purchase or lease the Prime. But--the lessor, the bank or finance outfit, is the purchaser so they get the credit. They might apply the credit to the value of the car when they calculate the value for the lease payments by the lessee (you); do not expect it. Demand it. The capital cost of the Prime you're leasing should be reduced by the amount of the credit, $4502, before they calculate the lease payments. If that ever happens, let us all know.

 

Paul Ryan said I can do my tax on a post card. Did he lie to me?

 

Is there any instance the lessee can claim the credit because the purchaser (the lessor=the bank or finance outfit) did not claim the credit? How can a lessee check to see if the bank or financial out fit has claimed the tax credit on the car he/she has been leasing?

 

Nope.
”You are the owner of the vehicle. If the vehicle is leased, only the lessor and not the lessee, is entitled to the credit.”
Instructions for Form 8936 (2017) | Internal Revenue Service

 

Why would the smart people at the lessor bank give away that tax credit money?

 

The max size the USPS says a postcard can be is 4-1/4 inches high x 6 inches long. The stage prop postcard they were using didn't even have room for the taxpayer's name & address.

 

Well, the banker I saw other day did not look so smart to me. He had to take out a calculator to get 3% of $30,000.