Tax Credit Incentives
August 20th, 2009
Question: Can the cash for clunkers car incentive program be combined with the hybrid tax credit?
Answer: Yes you can, but only if the new car you are buying qualifies for the tax credit.
Currently, the only cars that qualify for the Federal Tax Credit on hybrid cars are the Nissan Altima Hybrid and the GM hybrids. Ford hybrids qualify for only half their original amount, and will be phased out this September.
Toyota, Lexus and Honda hybrid cars no longer qualify for any Federal Tax Credits.
The Cash for Clunkers program is processed through your dealer. They credit you with the amount you qualify for when you turn in your clunker to the dealer (keep in mind that not all clunkers qualify– There are some pretty strict rules about what qualifies), and the dealer is reimbursed by the U.S. government later on once the clunker has been junked. The credit for the old clunker can be as high as $4500, if it qualifies.
To claim your Federal Tax Credit for the new car, you file a Form 8910 with your 2009 Federal 1040 Income Tax form next April, if you bought a car that qualifies for the credit this year.
Right now I think the Nissan Altima Hybrid is the best deal. It qualifies for a $2300 Federal Tax Credit.
Hope this helps.
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Tax Credit Incentives
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