New Car Tax Break The type of new car you purchase will determine whether or not you qualify for a new car tax break. If you’re going green and purchased a plug in, electric vehicle, then you’re in for some good news.
Individual Income Tax Return Filing Online
Buyers of qualified vehicles may be eligible for a tax credit of up to $2,500 to $7,500, depending on the capacity of the vehicle’s battery. Certain lower speed electric vehicles can get a tax credit up to $2,500 and this also applies to certain two or three wheeled electric vehicles.
The rules and regulations can be a bit complicated concerning the new car tax breaks. I suggest you do your research before you purchase a new car to determine it’s tax credit eligibility. You will need to know the difference between the four different types of the alternative fuel motor vehicles. I will give some information for each type of alternative fuel vehicle for tax credits to get you started.
The Alternative Fuel Motor Vehicle Credit -There are separate tax credits for the four different categories of vehicles.
Qualified Hybrid Vehicles – This hybrid vehicle uses a combination of gas and electric engines. This vehicle has an internal combustion engine and a rechargeable battery. Qualified Fuel Cell Vehicles – This vehicle is powered by cells that convert chemical energy directly into electricity.
Federal Personal Income Tax Exemptions
Qualified Alternative Fuel Vehicles – This vehicle uses compressed natural gas, liquefied natural gas, propane (liquefied petroleum gas) and hydrogen. This vehicle can also run on mixed fuels, such as liquefied propane gas and others.
Advanced Lean-Burn Technology Vehicles – This vehicle uses more air than is necessary for complete combustion of the fuel.
I advise you to make your purchase of a new car or vehicle early in the year. You may not know this, but the end of the first calendar quarter is the only quarter in which you can claim the full new car tax credit, applied to the first 60,000 vehicles sold. Sequential quarters drop the tax credit down to 50% followed by 25%.
Capital Gains Tax Exemptions
Visit TurboTax Online to claim your new car tax break deduction. Now is the time to get answers to your all of your tax questions. More people trust their taxes to online tax preparation because it’s easy, safe, and you never have to leave the comfort of your home.