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Tax questions...

Discussion in 'Gen 2 Prius Main Forum' started by clintd555, Jan 26, 2006.

  1. clintd555

    clintd555 New Member

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    Is the tax break for the Prius a "Tax Credit" or a "Tax Deduction"? There's a big difference between the two! :unsure:

    Also, can you take advantage of this tax break every year you own your hybrid or is it just a one time thing?


    Thanks!


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    #1 clintd555, Jan 26, 2006
  2. galaxee

    galaxee mostly benevolent

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    one-time credit, think it's $3150. the deduction was replaced by the credit starting 1/1/06.

    there are a ton of threads here, just do a search for tax credit for some real in-depth info.

    basically, if you buy in the quarter that toyota sells 60k hybrids or the quarter after, you get the full credit. after that, it starts to drop until completely phased out. you claim it on your 06 tax return. and the car has to be purchased new, not a lease and not bought used.
     
    #2 galaxee, Jan 26, 2006
  3. clintd555

    clintd555 New Member

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    So this credit will be phased out after they sell 60,000?? <_<
    I thought it was a permanent thing that'll last until hybrids become the "norm"
     
    #3 clintd555, Jan 26, 2006
  4. Kiloran

    Kiloran New Member

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    Nope. It begins to phase out the quarter after the quarter in which a manufacturer sells 60,000 qualified hybrid vehicles (after Dec. 31, 2005) of all models.

    There's good coverage of this in the Government_Incentives section of our FAQ.
     
    #4 Kiloran, Jan 26, 2006
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