Tax incentives 2005 vs. 2006
Created August 29, 2005, at 2:10 pm by Anonymous
We are planning to buy a Highlander Hybrid. I was wondering if anyone knew much about the new US tax incentives for 2006? I know that there is a limit for hybrid incentives in 2006 based on sales per manufacturer. I don't know if we should buy now and take the $2000 deduction or wait and possibly get the larger $ tax credit. We could purchase first thing in January, but I am afraid we could miss out on the maximum credit amount if Toyota's sales are high. Would it be a huge gamble to wait?
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6 years ago
Under culture & market look at sales numbers.
The most popular hybrid this year by far toyota prius has a little over 50,000 sold in 7 months. You'll likely get the tax credit easily if you act early in 2006. Also check if you dealer on supply in late in this year to find availablitiy.
6 years ago
If you buy in 2005 you will get a 2000 dollar DEDUCTION which can be up to 30% depending on what bracket you are in. So if you're in the 30% bracket you get about $600 off your taxes.
If you buy in 2006 you get a 2000 dollar tax CREDIT which means you will get the whole 2000 off your taxes. The tax credits are limited but if you buy in January you will have no problem getting it.
6 years ago
What is considered the transaction date? I will be ordering a Prius during Dec '05 for delivery sometime in '06. Spoke with the dealer and they require a deposit when the order is placed. Would this count as an '05 or '06 transaction for tax purposes?
6 years ago
We have a related question: Of course I would love to have the credit instead of the deduction, but I really need to replace my car---I really don't expect the one I have to last until 2006. My wife and I have decided on a 2006 Honda Civic Hybrid (yes, we are aware of all the first-year-after-a-redesign issues).
My question is -- will we actually qualify for the 2005 deduction? The 2006 model is not explicitly listed as a qualifying vehicle (only the 2003-2005 models are listed). I know other vehicles have been added, but with the new credit for 2006, are they going to bother?
I just don't want to fall into a tax-limbo where I don't qualify for either incentive. (And I don't know anywhere else to ask.) Thanks.
6 years ago
The dealer I spoke with (TX) said the "sale date" is the day you drive the car off the lot. I've also been told to expect 4-6 month waits for the Prius.
How's pricing looking elsewhere? How much above MSRP is the going rate?
6 years ago
Is the 2006 hybrid tax credit now law? That is, passed and signed? I have a Civic Hybrid on order from one dealer with delivery in November but an option on another Civic Hybrid with a January (or February) date? I need the car now but $600 vs. $2000 would make the wait worthwhile. Help?
6 years ago
2006 Tax incentives are law it was part of the Energy Bill Bush signed into law 1-2 months ago. It takes effect Jan. 1, 2006. If by chance the one on later order is a 2006 model and the available one is 2005. I would hold out for the 2006 model as the engine is redesign for better HP and MPG.
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