Buyers of Hybrid Cars Get a Pleasant Surprise
Tom and Ann Welly set out to be environmentally friendly last summer by purchasing a Toyota Prius hybrid gas-electric vehicle.
"This was (our way) to be effective in the energy crunch," said Tom Welly, a retired marketing and communications professional.
This tax season, the Toledo, Ohio, couple are discovering an added bonus.
"Personally, I think having a hybrid is the responsible thing to do," said Ann Welly. "But it's a fun thing to discover that we're getting a tax break."
Buyers of hybrid cars in 2005 are allowed a $2,000 deduction on the tax returns to be filed this April.
Because of legislation passed last fall, buyers of hybrid cars and sport-utility vehicles this year will be able to get a $400 to $3,400 tax credit, depending on model, for the taxes that will be filed in April 2007.
A tax credit directly reduces taxes owed; a deduction reduces taxable income.
Ford Weber, also of Toledo, said the promise of getting 51 miles to the gallon during highway driving was a big incentive for him to buy a hybrid Honda Civic.
The tax break, he said, is a big help in offsetting the higher price of a hybrid versus a regular vehicle.
Weber picked up the car on Jan. 2, because he wants to take a tax credit of roughly $2,100 on the taxes that he will file in April 2007.
"A tax credit is like a rebate from the federal government," he reasoned.
Buyers of fuel-cell vehicles, which are different from gas-electric hybrid cars, this year will get a maximum allowable credit of $8,000. The maximum allowable credit for alternative fuel vehicles weighing less than 8,500 pounds is $2,500.
The new federal energy law that allows the tax credits also provides credits to homeowners who improve the energy efficiency in their homes.
It provides a 10 percent credit, to be taken on the tax return next year, for buying qualified improvements, with a total maximum credit of $500. Eligible improvements
include better insulation systems, new windows, exterior doors, and metal roofs.
RocklinToday
"This was (our way) to be effective in the energy crunch," said Tom Welly, a retired marketing and communications professional.
This tax season, the Toledo, Ohio, couple are discovering an added bonus.
"Personally, I think having a hybrid is the responsible thing to do," said Ann Welly. "But it's a fun thing to discover that we're getting a tax break."
Buyers of hybrid cars in 2005 are allowed a $2,000 deduction on the tax returns to be filed this April.
Because of legislation passed last fall, buyers of hybrid cars and sport-utility vehicles this year will be able to get a $400 to $3,400 tax credit, depending on model, for the taxes that will be filed in April 2007.
A tax credit directly reduces taxes owed; a deduction reduces taxable income.
Ford Weber, also of Toledo, said the promise of getting 51 miles to the gallon during highway driving was a big incentive for him to buy a hybrid Honda Civic.
The tax break, he said, is a big help in offsetting the higher price of a hybrid versus a regular vehicle.
Weber picked up the car on Jan. 2, because he wants to take a tax credit of roughly $2,100 on the taxes that he will file in April 2007.
"A tax credit is like a rebate from the federal government," he reasoned.
Buyers of fuel-cell vehicles, which are different from gas-electric hybrid cars, this year will get a maximum allowable credit of $8,000. The maximum allowable credit for alternative fuel vehicles weighing less than 8,500 pounds is $2,500.
The new federal energy law that allows the tax credits also provides credits to homeowners who improve the energy efficiency in their homes.
It provides a 10 percent credit, to be taken on the tax return next year, for buying qualified improvements, with a total maximum credit of $500. Eligible improvements
include better insulation systems, new windows, exterior doors, and metal roofs.
RocklinToday
posted by Ottawa Gas Prices | 8:58 PM
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