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  1. #1
    Guest

    2006 Tax Credit on a leased vehicle

    I am considering leasing a new hybrid in 2006. Does anyone know how the 2006 tax credit would apply to a leased vehicle?

    First of all, I am assuming that I would receive the credit and not the bank or "owner" of the vehicle.

    Given this, could I take the entire credit in the year the lease was started or would it have to be spread out over the life of the lease? Is there a formula for this?

    Thanks.

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  3. #2
    Guest

    2006 Tax Credit on a leased vehicle

    Bob -- you didn't specify where you live, so it's hard to answer the question.

    Where I live (Ontario, Canada), you have to wait until the first 12 months of the lease is up before you can apply for a rebate on the PST paid to date. Depending on your lease rate, getting the full rebate may take longer.


  4. #3
    Guest

    2006 Tax Credit on a leased vehicle

    Thanks for the response. I live in Michigan and don't know what lease rate I would be paying.

    I am not sure what PST is. But if I understand you correctly, your rebate is a prorated amount of what you have paid over the last year. So if you have a five year lease, it will take five years to fully benefit from this rebate?

    I don't know if this is the same as the system we have in the US?

  5. #4
    Guest

    2006 Tax Credit on a leased vehicle

    The energy bill that was recently passed in the US has pushed me in the direction of a hybrid, and I would also like to lease instead of buy.

    Any additional information on how tax credits or other incentives are applied to leases vs. purchases would be appreciated.

    Any additional information on how the 2006 US tax credit would apply to a lease would be extremely useful.

  6. #5
    Guest

    2006 Tax Credit on a leased vehicle

    It has been a while since this was posted and I was hoping someone may have the answer now.

    Any ideas on how the new tax credit will work with leased vehicles?

    Thanks,
    Bob

  7. #6
    Guest

    2006 Tax Credit on a leased vehicle

    The Federal deduction is only for the purchase of a hybrid. Since a least is not a purchase in the year 2005 which is a one time deduction, think your SOL.

  8. #7
    Guest

    2006 Tax Credit on a leased vehicle

    are you sure about that? i thought leaseing counted.

  9. #8
    Guest

    2006 Tax Credit on a leased vehicle

    I'v seen nothing that implies leasing will apply.
    http://www.consumeraffairs.com/news0...d_hybrids.html

  10. #9
    Guest

    2006 Tax Credit on a leased vehicle

    The 2005 tax deduction did not include leased vehicles, but my understanding is the 2006 tax credit does.

    The following web link contains the 1724 page bill which was passed earlier this year and speaks to these credits. The relevant pages are from 1405-1410. I have copied the most relevant clause (p.1408 line 16-18) below (text omitted and capitalization added).

    http://www.ne.doe.gov/EPAct2005/hr6_textconfrept.pdf


    " - the term "new qualified hybrid motor vehicle" means a vehicle - ...which is acquired for use or LEASE by the taxpayer and not for resale..."


  11. #10
    Guest

    2006 Tax Credit on a leased vehicle

    The question that I have reading this again is, who is the "taxpayer"?

    a) The individual who will be using the car (a leasee)

    or

    b) the company/bank that owns the car and leases it to the driving individual (the leasor).

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