Tax Rebate -- Missed it by that much!

[USMA84]

In an effort to get new cars sales going, the federal gov't is offering rebates of $3K - $5K for new cars purchased during the 2009 calendar year. The lowest amount (i.e. $3K) is offerd for those cars getting more than 27 mpg. There are additional threshholds for the $4K & $5K rebates, also based on fuel economy.

Unfortunately, the Hyundai Genesis just missed the requisite fuel economy to be included in this. With the 3.8 getting 27 mpg on the highway, it missed it by one mpg!

That would have been a nice incentive for those out there who are contemplating the purchase of the 3.8!

 

[Mark_888]

Do you have some documentation on this? The only thing I have heard about is that there are tax deductions (not rebates or credits) available as follows:

Deductions allowed:

You are allowed to declare as a deduction (against your income) the following:

1. Sales Tax Paid on the vehicle
2. Interest on your loan (interest on car loans was deductible up until about 1988 and now it is being re-instated).
3. You do not have to itemize deductions to claim this deduction.


Eligibility:

1. Income Limits for new car stimulus:
The deduction is phased out for individual taxpayers with modified annual gross income between $125000 and $135000. For joint filers the deduction is phased out if the combined annual gross income is between $250000 and $260000. Thus to get full benefits of this special deduction for sales tax and auto loan, your annual income must be at most $125000 (if your are individual taxpayer and $250000 if married).

2. Dates of New Car Purchase to qualify for new car stimulus:
The New Car must be purchased after 17th February 2009 and before December 31, 2009. Cars purchased before 17th February 2009 are not eligible for the New car stimulus according to information released by IRS.

2. Maximum new car price, Maximum new car weight to qualify for new car stimulus:
The above incentive or car buyer stimulus is available only for new cars which cost up to $49,500. Moreover the car must weigh less than or equal to $8,500 pounds (That means sport utility vehicles, light trucks, motorcycles and even motor homes qualify, according to CCH, a tax information service).

 

[Mark_888]

For those who are not knowledge about taxes, here is the difference between a tax credit (rebate) and a tax deduction:

Assume you bought a new car and the taxes were $2,000.00. Assume you are in the 40% tax bracket (your highest taxable income is taxed at the 40% rate). Assume your federal tax owed for 2009 was $20,000.00.

If you received a tax credit for taxes paid on the purchase, your federal taxes owed would be reduced to $18,000.00.

If you receive a tax deduction of $2,000.00 then your taxable income is reduced by $2,000.00 (not your tax bill) and since your tax bracket is 40%, then you tax bill will be reduced by $800.00 ($2,000.00 times 40%).

 

[DieselHybrid]

USMA84- First: Beat Army! Second, can you please provide a link or reference?

It would seem that if this existed at all- it should be for the overall vehicle mpg- not just a hwy mpg rating.

Can anyone confirm or deny USMA84's claim?

Thanks in advance.

 

[Mark_888]

Can anyone confirm or deny USMA84's claim?.

It's hard to refute a claim that we have no source for, but the only info I could find on the recent stimulus package is posted above.

However, in past years there have been tax credits available for hybrid or alternate fuel vehicles that achieved certain fuel mileage targets. Most of these are gone because there was a limit for each manufacturer (they last only until an automaker's hybrid sales reach the 60,000 mark), but some automakers may still have 2009 tax credits available to buyers. But I don't think the Genesis would qualify even it it got 28 mpg highway (I think the target was based on City mileage, not highway), and of course the Genesis is not a hybrid.

This may have the been the "inspiration" for the original post.

 

[ctrcbob]

http://content.kiplinger.com/tools/slideshows/StimulusFacts/5.htm

 

[Mark_888]

http://content.kiplinger.com/tools/slideshows/StimulusFacts/5.htm

A highly abbreviated (and sometimes factually incorrect) version of what I posted above. Why bother even posting it?

 

[ctrcbob]

A highly abbreviated (and sometimes factually incorrect) version of what I posted above. Why bother even posting it?

I posted it because I have it.

Also, I believe everything I read on the internet.