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Tax Deduction Consulting: Hybrid Cars Brigham City UT

The Energy Policy Act of 2005 established a tax deduction for hybrid cars put into service on or after January 1, 2006. The tax deduction is actually a tax credit. A tax deduction, technically, is subtracted from your taxable income and reduces your tax liability by a certain percentage depending on your tax bracket.

Mr. Gregory W. Williams (RFC®), CFP, CHFC, CLU, LUTCF, MSFS
(801) 453-2271
6340 South 3000 East, Suite 500
Salt Lake City, UT
Company
Exit Strategy Specialists, LLC
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Years of Experience: 26
Membership
IARFC, MDRT, FPA
Services
Invoice, Estate Planning, Business Planning, Portfolio Management, Trustee Service, Pension Planning, Executive Compensation Planning, personal Coach, Retirement Planning, Tax Planning, Seminars Work, Employee Benefits, Stocks and Bonds, Mutual Funds, Mortgage Loans, Annuities, Life Insurance, Disability Income Insurance, Long Term Care Insurance, Medical Insurance, Group Insurance, Business Coach, Charitable Planning, Education Plan, Asset Protection, BuySell, Compensation Plans

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H&R Block
(801) 334-4002
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HILL AFB, UT

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(801) 832-8932
2356 S FOOTHILL dr
SALT LAKE CITY, UT

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(866) 871-1040
6223 Highland Dr
Salt Lake City, UT

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H&R Block
(801) 733-0847
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SALT LAKE CITY, UT

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Mr. A. Wayne Margetts (RFC®), LUTCF
(801) 532-1871
175 S Main St, Ste 1050
Salt Lake City, UT
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LPL
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Education: BSc (Math)MBA
Years of Experience: 16
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IARFC, MDRT, NAIFA
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Invoice, Estate Planning, Business Planning, Portfolio Management, Pension Planning, Executive Compensation Planning, Retirement Planning, Medicaid Planning, Tax Planning, Seminars Work, Employee Benefits, Stocks and Bonds, Mutual Funds, CD Banking, Annuities, Life Insurance, Long Term Care Insurance, Group Insurance, Charitable Planning, Education Plan, Charitable Foundations, Asset Protection, BuySell, Compensation Plans

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H&R Block
(435) 462-2785
750 S STATE ST
MOUNT PLEASANT, UT

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(435) 789-0691
1285 W. Hwy 40
Vernal, UT
 
H&R Block
(801) 255-3231
7065 S STATE ST
MIDVALE, UT

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(801) 542-0230
8282 S. State St. Suite
Midvale, UT
 
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Tax Deduction Consulting: Hybrid Cars

Tax Deduction for Hybrid Cars

Many people ask about the tax deduction for hybrid cars. The good news is that is actually is not technically a tax deduction at all, but rather a tax credit.

The Energy Policy Act of 2005 established a tax deduction for hybrid cars put into service on or after January 1, 2006. The tax deduction is actually a tax credit. A tax deduction, technically, is subtracted from your taxable income and reduces your tax liability by a certain percentage depending on your tax bracket. A tax credit, on the other hand directly reduces the amount of tax that you must pay and is a much better deal. This tax deduction for hybrid cars is a full credit, but is subject to certain restrictions.

The credit is only available to the original purchaser of the vehicle. If the vehicle is leased, the credit is taken by the leasing company and not the customer. Although the credit is not subject to any phase out amount with individual tax payers, there is a limit of 60,000 of each qualified vehicle before the credit itself begins to phase out. In the current list, for example, the Toyota Prius has reached the 60,000 vehicle cap and there is no credit available for this model if the purchase date is later than 10/1/2007.

The Internal Revenue Service publishes the list of qualified vehicles and sets the credit amount for each model. This credit amount varies from vehicle to vehicle. The 2008 Ford Escape has a credit of $3000 which is one of the higher amounts and each different vehicle on the list has its own set credit value. In the case of the Ford Escape, this would mean that the amount of tax owed would be lowered by the full $3000 of the credit. This amounts to a virtually rebate on the purchase price of the vehicle.

The Energy Policy Act of 2005 represents a good example of the ability of the Government to use tax credits to spur the public to perform actions that are deemed to be in the public interest. To provide a tax deduction of hybrid cars w...

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