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Federal and State Incentives for Plug-Ins, EV's

Discussion in 'Gen 1 Prius Plug-in 2012-2015' started by wjtracy, Sep 24, 2012.

  1. fortytwok

    fortytwok Active Member

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    I agree - that example is a no-brainer. As would be most everyone's given it doesn't take much to have owed and paid $2500 over the course of the year.
    I think some were under the impression that you actually needed to owe the govt $ at the end of the year to take the credit. Your earlier post seemed to question that :

    I called the IRS - its not that you need to owe 2500 after all is said and done - you need to have owed and paid 2500 in taxes during the year...​
    "...hmm, that's a funny answer from IRS...not sure I agree."
     
  2. CharlesH

    CharlesH CA HOV Decal #5 on former PiP

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    Some folks may have significant income, but it is offset by business losses and "loopholes", so they end up owing very little tax. And folks living on retirement income may owe very little tax, depending on their source.

    As pointed out, how much you paid toward your tax liability during the year in withholding or estimated tax payments is irrelevant to this discussion.
     
  3. fortytwok

    fortytwok Active Member

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    I can't speak to the former* but looking at the standard deductions and current tax rates it looks at though if you made 38k used married filing jointly and the max 3k in stock losses you'd have owed and paid $2,500.
    That goes for retirees too - excluding those taking just Roth $. I'd say its a rare retiree who's receiving under 38k and would buy a brand new PiP

    * remember even Romney and Obama paid over 11%
     
  4. mozdzen

    mozdzen Active Member

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    Rare yes, but not zero.
     
  5. mozdzen

    mozdzen Active Member

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    Or, you make 100K per year, pay $25K in taxes, get some deductions, pay $20K in taxes, but say you took capital gain losses of $20K or had a carry over loss, then the credit would be useless too.
     
  6. fortytwok

    fortytwok Active Member

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    Nooo! - cap gain losses are limited to 3k per year - if you have 20k in losses you get to take 3k now and carry over 17k for future years

    here are links :
    Ten Important Facts About Capital Gains and Losses

    What is if any the maximum allowable short term capital losses you can claim on your taxes
     
  7. mozdzen

    mozdzen Active Member

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  8. fortytwok

    fortytwok Active Member

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    that's what I'm saying - you can't take 20k in losses
    see that attached IRS link
    the most anyone can take in any one year is 3k

    all this leads back to the fact that if you make at least 38-40k you'll be able to take that PiP deduction
    and even less income than that if single
     
  9. mozdzen

    mozdzen Active Member

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    Ah - ok. You can use more than 3K to offset gains though, I believe. So yes, you'd have to get your income taxes reduced by other means.
     
  10. markaw

    markaw Junior Member

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    I recently purchased a 2012 Prius Plug-in advanced: can or should I file a for the credit in advance of filing my 2013 taxes
     
  11. ggood

    ggood Senior Member

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    No, you'll have to wait for your 2013 return.
     
  12. ksstathead

    ksstathead Active Member

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    You should change your withholding if you will be overpaid. No reason to not collect your cash sooner. Remember to change it back in January, as appropriate.
     
  13. wjtracy

    wjtracy Senior Member

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    Congrats on the PiP.
    New Yorkers will want to follow the posts of PriusChat member Electric Charge, who has some good lists of the incentives for NY PiP owners (HOV etc). Welcome to PriusChat.

    National Plug In Day - Central New York

    Read more: http://priuschat.com/threads/national-plug-in-day-central-ny.131065/#ixzz2funU3Dl8
    Follow us: @PriusChat on Twitter | PriusChat on Facebook
     
  14. markaw

    markaw Junior Member

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    Thank you all!
    To be clear I have been a member for a while (largely lurking and learrning).
    This is the second 2012 PIP I've bought (first was used & w 5K miles).
    For pricing reference, I purchsed the first in June 2013, a standard PIP first From Acton Toyota in Acton Mass, for $24.5K, the second, a PIP Advanced was just pruchased new for 31K from Prime Toyota in Boston.
    Both dealers met me in Bennington VT (our 2nd home in VT), where we registered them and then parted.
    As a family we have and continue to own and drive two additional Prius' a 2007 & 2009 (all excellent efficient vehicles)
     
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  15. pmv

    pmv New Member

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    I am shopping for a PIP and doing research on incentives.
    I read through this thread and still not sure if I understand the $2500 federal incentive correctly.
    If my 2013 federal tax is $7000 and my company withheld $7500 from my salary for federal tax, I'll get $500 refund from IRS at tax time (2014). Now if I buy a PIP, is my tax reduced by the $2500 credit and I will get $3000 refund from IRS instead?
    The reason I ask because a salesperson at a dealer told me I only get the $2500 credit if I underpaid my tax by that amount. If I overpaid IRS, I won't get the $2500 credit. It doesn't make sense to me.

    PIP owners - please clarify. Thanks.
     
  16. wjtracy

    wjtracy Senior Member

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    The salesman is wrong, if that is what he said.
    The only thing that matters is that you must owe at least $2500 Fed tax to take the whole credit.
    In your case no problem if you owed $7000. It does not matter that you might have overpaid via payroll deduction. You will just get a big ol' refund check in the mail.

    If you use TurboTax you can do a sample calc to test out how it works.

    How about this idea: take your PiP refund in US Savings Bonds. I Bonds protect against inflation, and EE Bonds are guaranteed to double in value if you hold 20 yrs (about 3.3% interest). Not too shabby!
     
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  17. Priusmpg

    Priusmpg Active Member

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    sorry if this question has been asked before but its a simple one. Is the $2500 tax credit for California a refundable tax credit or non rewindable

    A refundable credit means that the tax break will get you money back from the IRS even if your tax bill is zero. For example, you owe $500 and can claim a $1,000 tax credit. If that credit is refundable, you'll get $500 back as a refund.
    However, if the credit is nonrefundable, you'll only be able to use the credit to zero out your tax bill, but no more than that. The excess $500 from the credit is lost.


     
  18. Andyprius1

    Andyprius1 Senior Member

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    . Good information regarding the tax credit. Not so good on 3.3% and hold for 20 years. Probably most of the working population on PC would want to double their money in 3-5-7 years and do it in a retirement fund. Mutual Funds can do this.
     
  19. Andyprius1

    Andyprius1 Senior Member

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    $7500 doubling every 7 years =. $60,000 in 21 years, actually more as the interest, makes interest. VERSUS. : $15,000 in 20 years.
    7 years would be considered normal or conservative. All tax free, naturally.
     
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  20. wjtracy

    wjtracy Senior Member

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    Sorry Priusmpg... just now saw your question...as far as the $25o0 Federal Credit you must actually owe at least $2500 to IRS in taxes to get the full $2500.

    >>>If you are in this situation (if you have <$2500 tax owed), let us know ASAP there may be a few things you can do right away like roll over some IRA to Roth IRA to create $2500 tax owed.

    If your question concerns CA, I am not sure how CA's credit works.
     
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