Hybrid Car Tax Break

A hybrid car tax break is still available - although not for long. One of the big incentives to buying a hybrid car used to be the "Federal Tax Credit" that rewards you for your 'green efforts.' The reason why the Federal government suddenly became so generous back in 2006 is because of the higher prices that buyers were faced with. This meant that far fewer cars would be sold.
And since the U.S. hybrid car tax break program was started by the Federal government to begin with, they have an obligation to the American public, right? But don't expect any love coming your way with the new administration... The program is set to go belly-up in April 2010.
Our Japanese friends out-engineered us shortly after President Clinton commissioned the program back in 1993. Japan's total domination of the technology resulted in the complete withdrawal of U.S. auto manufacturers from the program by 2001. Because by this time, the Toyota Prius was everywhere, with Honda not far behind.
Where was the U.S? Ford and a couple other Detroit automakers were quietly making deals with Toyota to license their technology. It's no secret that the U.S. has been playing "catch up" to Japan in nearly all automotive technologies for many years. And hybrid technology is definitely no exception.
Anyway, the Federal tax incentive program used to be a pretty good deal, and it's written to reward those good folks who elect to go for the really "good" hybrids. That is, the cars that substantially improve on their gasoline-only counterparts. The bigger the gas savings, the bigger the tax credit.
Here's how it used to work:
Every person who bought a hybrid vehicle after JAN 1st, 2006 is eligible for a tax credit up to a max of $3400, based on how the particular vehicle that he bought compares to the average car of its class and weight from 2002. Specifically, buyers will receive a $400 tax credit for every 25% improvement in efficiency.
In addition, you may be credited more money (to a max of $3400) based on how much fuel the government anticipates you will save based on the size and weight of the car.
But, there was a catch:
This credit was given to only the first 60,000 vehicles sold by each different manufacturer. Some--like Ford, for instance, didn't even plan on making 60,000 hybrid-electric cars through half of 2007. So each and every person who bought a Ford would get the credit.
Toyota, however, was a whole other story: They blew through their 60,000 quota in no time flat, leaving the remaining buyers federal tax credit-less. But then again, the Toyota Prius gets so much better gas mileage than most of Ford's that Ford's buyers don't stand to get anywhere near the max $3400 credit anyway.
The hybrid car tax credit system is likely to change again in the not-too-distant future, though. Hopefully, it will cover everyone again until everyone is driving one. But whatever happens with federal help for consumers, let's do our part and get a high-mileage car anyway. It will help us escape the choke-hold that the middle east has on our economy!
In the list below, notice how Toyota and Honda are conspicuously absent: Fords are still eligible, but the credits will be cut in half from amounts listed below starting April 1, 2009. In October 2009, the credits will be cut in half again, and will completely phase out on April 1, 2010.
Make Model Tax Credit
Audi Q7 TDI (Clean Diesel) $1150
BMW 335d (Clean Diesel) $900
BMW X5 xDrive35d (Clean Diesel) $1800
Chevrolet Malibu $1300
Chevrolet Silverado $2200
Chevrolet Tahoe $2200
Ford Escape (2WD) $3000
Ford Escape (4WD) $2200
Ford Fusion $3400
GMC Sierra $2200
GMC Yukon $2200
Lexus GS 450h $1550
Lexus LS 600hL $450
Lexus RX 400h $2200
Maxda Tribute (2wd) $3000
Maxda Tribute (4wd) $2200
Mercedes GL 320 Bluetec $1800
(Clean Diesel)
Mercedes R320 Bluetec $1550
(Clean Diesel)
Mercedes ML 320 Bluetec $900
(Clean Diesel)
Meredes S400 $1150
Mercury Mariner (2WD) $3000
Mercury Mariner (4WD) $2200
Mercury Milan $3400
Nissan Altima $2350
Saturn Aura Green Line $1300
Volkswagon Jetta TDI (Clean Diesel) $1300
Volkswagon Touareg TDI (Clean Diesel) $1150
So the above hybrid car tax breaks won't last long. Get yours now!