OK. So I purchased an '06 Prius in Dec. '05. My understanding is that only very recently the IRS (or a similar gov't body) approved the **'05** Prius for the $2000 tax credit, *if purchased before 12/31/05*. Is there anybody out there who can help me with this? Can I take the tax credit for '05, when I bought an '06 Prius? Thanks!
YUP! It's not really "recently" approved though, it's been around for quite a while. If you have taken delivery of the 06 you may have missed out on a better tax incentive though. Have you taken delivery? If that's the case, man I wish you could have been on PC sooner. You may have gotten a lot better tax credit. More info? Aaron
Sounds wrong to me. There's a $2000 tax deduction if you take delivery of a qualifying hybrid before 12/31/05. You can take that. But, that's a hell of a lot worse than an estimated $3150 tax credit if you took it AFTER 12/31/05. See: http://www.aceee.org/press/0508hybridtaxcr.htm http://www.aceee.org/transportation/hybtaxcred.htm#table
Model year is not relevant. If you put the car in service in 2005, you will not be eligible for the credit. Rather, you will be eligible for a $2000 tax deduction (not nearly as good). You can find coverage of these and other Government_Incentives in the Toyota_Prius_FAQ.
Your purchase in 2005 makes you eligible for a $2000 adjustment to income which reduces your taxable income. In my humble opinion and based on my experience, the $2000 adjustment might give some taxpayers a greater tax break than the tax credit (which replaces the adjustment for cars placed in service after December 31, 2005) because the credit can be limited by the issue of AMT. It all depends on your individual tax situation. None of knows what our 2006 tax returns will look like nor do we know what tax laws (I'm thinking specifically of AMT) will change that might affect this credit. I suggest you search this site and Kiloran's FAQ's for more information.
Actually the FAQ was started by NuShrike. (I just pimp it more than anyone else. ) Everyone is encouraged to contribute to it. Among other things, it has info about AMT and a link to the H&R Block AMT calculator. B)
