2006 Tax Credit Finally Settled

You may well be right, and it will be interesting to see how the specific instructions are printed. If they do say "take delivery" and do not ask for back-up documentation such as proof of purchase, then I will most likely go for the credit. Although the delivery checklist is not a legal document as is a purchase contract, still with a date and a mileage of 1, signed by the salesman and general manager, it does provide evidence of delivery. With AMT, probably does not matter anyway.

 

Sounds like its simple.. when did you take possession?... Taking possession means "when did the vehicle get transferred into your name"

What sounds confusing is you use the term "purchased" in Dec. Did you buy it and then just let it sit in the dealers lot till Jan?..... When you picked it up, did you do the paperwork then or in Dec?

The date you signed all the papers... or at least the date on the papers is what matters as far as depicting when you took delivery.. where it was parked doesn't matter.

 

Actually, according to the IRS official I spoke with, it's when the car is first "used".
Taking possession of the vehicle means just that. (i.e. driving it off the lot)
The dates on the paperwork should ideally corroborate the date you took possession.

 

1) Based on my conversation with an IRS official, yes. When the car is first used is the date of interest. Delivery of the vehicle into your possession would be considered first use.

2) Intent is an abstract concept. No doubt the IRS will have internal guidelines on how to assign intent based on dates, price, relationship of purchaser, etc.

 

I agree.. they make a special point to have the dates coorespond to when you took it.

I signed paperwork twice on mine, because when I took actual delivery was different than when I put my money down........

 

But if the dates are different, as in my case, unless the IRS decides to interpret "first put into service" type of language from the energy bill as meaning purchasing, then I should be able to claim the credit. Unless the IRS has already published specifics, I think it a matter of waiting until they do.

 

If I recall correctly, in the eyes of the law, "purchase" doesn't means filling out papers and/or paying for something, it generally necessarily includes receiving the property or service paid for.
In other words, in the eyes of the government, you mearly put down a hefty deposit until you actually received the vehicle.

 

That may be, but how can you prove thats when you took it if all the paperwork says otherwise?

 

If all your paperwork says otherwise, you're probably screwed and, it's probably partly your own fault for signing paperwork with false information.
The paperwork is supposed to reflect what happened.
How is the IRS supposed to know and why should they care that what you signed your name to was not true?

 

If you bought a 2005 and was claiming the 2006 credit, they would probrably make you prove it. "if you got audited".

But if you bought an early 2006 in 2005 with paperwork signed, but picked up in 2006, I doubt they would raise an eye.

But you just never know... chances are you won't get audited anyway.... but when it comes to this credit... I don't know what they may make you send with your tax papers if any... I've never done a credit before so I don't know.

 

Keep in mind that the government wants to give this credit.

I seriously doubt that a claim of filling out paperwork but taking possession in January is going to get challenged unless the IRS has evidence to the contrary.

 

yea, you would certainly think so... but we always have the problem of the right hand not cooperating with the left hand.
One hand gives, the other takes away.... like the chamber of commerce tweaking out with hybrid drivers getting so good a gas mileage that they thought they should be taxed to make up for all the gas tax they are not buying!...

What idiots!.... you never know what to expect when dealing with the Gov.

 

For the record, the COC is not part of the government.

 

Not much trouble. Actually on my forms, Clean-Fuel prints out on line 36.

I use Turbo Tax Premiere (use that version because of some schedule c / sole proprietorship activities). Don't know if your version is similar, but here is what I did to claim the deduction:

1) under the Federal Taxes tab, select Deductions, then select item #15 Other Expenses. 2) After about 5 screens (adoption, other expenses, etc.) you will hit the Electric Vehicle screen. You don't want this one. 3) Next screen is Clean-Fuel Vehicle Deduction. This is the one you want. Click on all of the check boxes presented here except for the INSTALLED question (and of course the None of the Above). 4) Next screen will show you list of all hybrids including the Prius. Select that, press continue, and TurboTax takes care of the rest....

 

Anyone heard anymore about Congress addressing the AMT exemption dropping in 2006? I imagine if that happens it will eliminate this credit for most of the middle class.

 

from CNN.com - Senate passes $70 billion tax bill

 

I don't understand the AMT but my gross income for 2006 will be around $10,000, and after the standard deduction and personal exemption, my taxable income will be under $2000. My actual tax will be approx. $200.

Does that mean the $3,150 tax credit would only benefit me a maximum of my $200 tax bill? That is, I can't get a $2,950 refund as a result of the tax credit?
(Somewhere on the forum I think I saw that the credit can't take your tax below zero. Is that true?)

 

Ouch... Baby.. I feel your pain... but your right!..

And welcome to the forum!.....

Sorry your first post is on an unpleasant note, but based on what I've argued and now understand, I too think its only fair to give you the credit and I feel a credit is a credit. But that not the way uncle sam interprets it. They only give back what you were already going to give anyway.

The way its worded is that it credits you back against your tax liability.

Don't confuse what your getting back at the end of the year as having anything to do with your "liablity". Regardless of how much you paid in during the year or didn't.. all that matters is How much a tax do you have to pay US based on how much you made?

If you truely only have a "liability" of 200.00, then thats all you can get back.
Sorry!... but theres no way around it.... if you would have bought in 2005 you would have gotten a deduction and maybe actually got more back because it would affect your "liablity", but oh well. Enjoy your awesome car... its worth it anyway!

 

my gross income for 2006 will be around $10,000, and after the standard deduction and personal exemption, my taxable income will be under $2000. My actual tax will be approx. $200.

If you only made 10k how can you aford 20K+ car?
I am sorry you won't get the money back, but after just doing my taxes I think most of us would rather have your tax liablity then ours.

 

Thats alot of car for that income.. unless something changing drastically, the gas savings is not going to offset the price of the car verses the alternatives for lesser cars.

Thats only 208.00 a week "gross"... the insurance will be a consideration too.

If he can pull that off, he can stretch a dollar about 20 times farther than I can!