a couple of 2006 Prius tax questions

<div class='quotetop'>QUOTE(elmofongo @ Jan 22 2007, 10:43 AM) [snapback]379058[/snapback]</div>

1. Yes and no. The bill of sale that shows the date when you bought it. It is a rolling amount based on the sale date.
2. Not that I know of yet. I meet with my CPA next Tuesday. If no one chimes in, I will let you know what I find out.

 

<div class='quotetop'>QUOTE(elmofongo @ Jan 22 2007, 10:43 AM) [snapback]379058[/snapback]</div>

I was wondering this same thing. I checked out the Franchise Tax Board for CA, and found this: Hybrid Bill (warning -- PDF alert). So I called Gail Hall, one of the staffers attached to the bill. She actually answered the phone! Unfortunately, the bill died, so there's no state tax deductions/credits for Californians. She said that there's a chance that a new bill could be introduced this year, so this would be a good time to call/email/write your local assemblyperson and ask him/her to sponsor new legislation.

 

<div class='quotetop'>QUOTE(Heir Butt @ Jan 22 2007, 02:19 PM) [snapback]379073[/snapback]</div>

If your CPA has a 2006 form 8910 (NOT the one with the 2005 in the upper right corner) all of us would like a copy of the file posted here. If you are going to use the 2005 dated form I recommend getting assurances in writing that if it is disallowed the CPA will file the 1040X and cover any interest and penalty not waived.

 

Has anyone from Kansas with a 2006 done their taxes yet? There was a post on the subject last year, I need to look it up, I guess. I will be using TurboTax, too.

 

I'm a CPA and believe I can shed some light on this discussion.

The reason the current Form 8910 shows 2005 in the upper right hand corner (even though this credit wasn't available unless cars were purchased after 2005) is because it could apply to taxpayer's who had a fiscal tax year.

So, if a business had a fiscal year ending 3/30/06 they would file a 2005 tax return. However, they would still get this credit if the car was purchased in 2006.

The IRS has not released the 2006 version of this form yet. My professional tax software has a draft version of the form and it's very similar to the 2005 version (but not exactly the same). I personally would not file a return without a final version of this form. However, if someone really really wanted to file the return now I think they could just cross out 2005 and write in 2006. I wouldn't file electronically though if you were doing this.

Anyone claiming this credit will also need to calculate their AMT liability. I think it will be interesting to see how many people qualify for full credit because of AMT. I've had several clients call me about buying a hybrid and the tax credit. In all their cases, they would not receive any credit because of AMT.

 

Sorry if this is a stupid question, but will TurboTax be able to automatically figure out if you are affected by the AMT?

Does anyone actually know how much you need to make in order to be affected by the AMT?

I've been filling out the 1040EZ form via TurboTax for a few years, and I'm fine with that. Easy as pie. But I'm starting to get paranoid that I'm going to mess up my taxes due to the extra forms and full 1040 that need to be filled out to claim the credit.

Thanks for any help...

 

TurboTax should be able to figure out if you're affected by AMT as long as the proper information is filled in. There's no simple answer to what income level can potentially kick in AMT. If someone has gross income higher than the AMT exemption amount ($42,500 for single, $62,550 for married filing jointly) you can potentially have an AMT liability. It really depends on income and the type and amount of deductions that someone has.

Since the hybrid tax credit is not available as a credit for AMT, having this makes it more likely that someone who normally wouldn't be in AMT will have to pay some.

 

Sigh, thanks Mustu. I think this may be a good year to go running back to the family accountant. I don't want to goof this up.

 

I just got back from my accountant's office and I was only able to use $650 of the credit (06 Prius purchased in July 06) due to AMT. Needless to say I'm not too happy about it! Apparently my Minnesota State income tax had a negative effect on my AMT situation?

 

Wow, that sucks nstevens.

Your post is making me nervous now...especially since I have no idea how AMT is calculated (apparently the method behind the madness is pretty darn convoluted)

I guess I can only hope for the best. I am not meeting with my accountant until February 7th, so I will have to wait two weeks to find out where I stand.

*fingers crossed*

 

<div class='quotetop'>QUOTE(mustu @ Jan 23 2007, 02:57 PM) [snapback]379653[/snapback]</div>

Mustu,
Welcome! Welcome! Welcome! And thank you for posting. There are so few people filing on a fiscal basis I didn't even think of that. I hope everyone who wants to file early reads your post.