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Virginia Taxes

Discussion in 'Gen 2 Prius Main Forum' started by jkaplan, Nov 30, 2004.

  1. jkaplan

    jkaplan New Member

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    I was looking through the virginia tax website and came across this:
    Virginia Department of Taxation

    Clean Fuel Vehicle and Certain Refueling Property

    General instructions: A credit may be claimed for: 10% of the deduction allowed under IRC Section 179A for the purchase of clean fuel vehicles, including hybrid vehicles, principally garaged in Virginia, or for the purchase of refueling property placed in service in Virginia; or 10% of the total costs used to compute the credit for electric vehicles under IRC Section 30. Individual filers complete Schedule CR, Part VIII, and corporate filers complete Form 500CR, Part IX, to claim this credit. For clean fuel vehicles, provide a property description. For qualified electric vehicles for which a federal credit was claimed, federal Form 8834 must also be attached. For refueling property, attach a copy of federal Form 4562 or other form showing computation of the Federal Section 179A deduction. Unused credits may be carried forward for five years.
    • If you claimed a clean fuel vehicle deduction on your federal return, you may claim a credit on your Virginia return equal to 10% of the amount deducted on your federal return, not to exceed your Virginia tax liability. As explained in the general instructions, you must provide a description of the property for which the credit is being claimed. In lieu of a separate statement, you may write directly on the individual Schedule CR or the corporate Form 500CR. For example, if you claimed a clean fuel vehicle deduction on your federal individual income tax return for the purchase and use of a Honda Insight (hybrid vehicle), you should complete Schedule CR, Part VIII, Lines 30 through 34, and write next to line 30, "Clean Fuel Vehicle - Honda Insight".
    • If you claimed a credit for qualified electric vehicles on your federal return, you may claim a credit on your Virginia return equal to 10% of the cost used to compute the federal credit.
    • If you claimed a deduction for clean fuel vehicle refueling property on your federal return, you may claim a credit on your Virginia return equal to 10% of the amount deducted on your federal return, not to exceed your Virginia tax liability.


    Which references this:

    Code Section: 58.1-438.1
    Tax Type: Corporation Income Tax; Individual Income Tax
    Brief Description: Tax credit for clean-fuel vehicles and certain refueling property
    Topics:

    § 58.1-438.1. Tax credit for vehicle emissions testing equipment, clean-fuel vehicles and certain refueling property.
    Any corporation, individual or public service corporation shall be allowed a credit against the income or gross receipts taxes imposed by Subtitle I (§ 58.1-100 et seq.) and Chapter 26 (§ 58.1-2600 et seq.) of Title 58.1 of (i) an amount equal to ten percent of the deduction allowed to such corporation, individual or public service corporation under Section 179A of the Internal Revenue Code for purchases of clean-fuel vehicles principally garaged in Virginia or certain refueling property placed in service in Virginia or ten percent of the costs used to compute the credit under Section 30 of the Internal Revenue Code and (ii) an amount equal to twenty percent of the purchase or lease price paid during the taxable year for equipment certified by the Department of Environmental Quality for vehicle emissions testing, located within, or within any county, city or town adjacent to, any county, city or town wherein implementation of an enhanced vehicle emissions inspection program, as defined in § 46.2-1176, is required. Credits granted to a partnership or S corporation shall be passed through to the partners or shareholders, respectively. If the credit exceeds the tax liability in a year, the credit may be carried forward up to five succeeding years.
    (1993, c. 562; 1994, cc. 164, 875; 1995, c. 100; 1997, c. 350; 1998, c. 599.)


    So, does this mean I get my $2000 federal tax deduction and a Virginia Tax Credit of $200 (10% of the $2000 federal deduction)?

    Thanks

    Joe
     
  2. vapcguy

    vapcguy New Member

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    Note that, according to Section 179A of the IRS code, as referenced at law.cornell.edu/uscode/text/26/179A, this is only "allowed for the taxable year in which such property is placed in service.", so you would have had to have bought it during the 2014 tax year to apply it to taxes filed in 2015. But yes, you could deduct $2000 for your federal taxes but there is a subparagraph B (Phaseout) that says "In the case of any qualified clean-fuel vehicle property placed in service after December 31, 2005, the limit otherwise allowable under subparagraph (A) [$2000] shall be reduced by 75 percent.". That would mean if you bought it after 2006, you could only claim $500 for the year when you bought it, for federal taxes. For Virginia taxes, then, it would go to $50, and you must use and apply a federal Form 8834 to your federal taxes for the electric plug-in version, in order to take, but I saw at tax.virginia.gov/content/tax-credits#Vehicle_Emissions_Testing_Equipment__Clean_Fuel_Vehicle_and_Certain_Refueling_Property_Credit that "For taxable years beginning before January 1, 2007 only: If you claimed a deduction for clean fuel vehicle refueling property on your federal return, you may claim a credit on your Virginia return equal to 10% of the amount deducted on your federal return, not to exceed your Virginia tax liability.", so this has already been phased out for state taxes after January 1, 2007.
     
    #2 vapcguy, Apr 12, 2015
    Last edited: Apr 12, 2015
  3. bisco

    bisco cookie crumbler

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    is there a statue of limitations on old threads?:p
     
  4. vapcguy

    vapcguy New Member

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    Well, someone could run across this and wonder the same thing, as I was, while doing my taxes.
     
  5. wjtracy

    wjtracy Senior Member

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    I am not aware of any state incentives for Plug-In or Hybrids in VA. We do have HOV plates which is a complicated story (mostly benefits "grandfathered" older clean fuels vehcile owners).

    However, some localities (and we have about 120 "localities" in VA) offer reduced annual car taxes on the green cars. The only locality I am aware of that still does this is Arlington County which has tax relief for clean fuels cars.
     
    #5 wjtracy, Apr 12, 2015
    Last edited: Apr 12, 2015
  6. bisco

    bisco cookie crumbler

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    see, you signed on in 2oo6, 2 years too late.;)
     
  7. wjtracy

    wjtracy Senior Member

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    Even beat you Bisco with 2005 sign on!
     
  8. bisco

    bisco cookie crumbler

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    early adopter! probably driving a diesel now.:p
     
  9. wjtracy

    wjtracy Senior Member

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    I see now why this issue comes up (doing my VA taxes) TurboTax for Virginia says (and I think this is way out-dated and inaccurate):

    As far as I know, we have no VA tax credit for plug-in or hybrid vehicles. For kicks I did a test calc, bought myself a 2014 Nissan Leaf on paper and put it in TurboTax, and as expected there was no VA credit given (just the Federal $7500 credit).

    And I must say it was indeed appropriate to post on the 2004 thread topic as that must be when the original language made sense.

    This is a little unacceptable too...a few years back, VA shut down the free VA on-line tax service forcing us into other options
     
    #9 wjtracy, Apr 15, 2015
    Last edited: Apr 15, 2015