wait. that's dumb. i thought the purpose of the tax breaks was to increase the number of hybrids on the road... if they are only doing them for a certian number vechicles then it's not really doing anything.

Who said it was smart? Congress does these populistic things to curry favor with the voters, whether they make sense or not. Hybrids are so popular right now that they don't need any tax incentives.

The reason for limiting to a certain number of vehicles is budget contraints.

The same goes for the HOV lane stickers in California. Most of them will go to people who already owned hybrids, not to new buyers. What kind of incentive is that?

2006 HCH Alabaster Silver w/Navi
2003 Honda Accord LX

Actually, it's a $2000 deduction, not credit. If you're in the 25% tax bracket, you take about $500 off your taxes, not $2,000.

Also, the use period of the deduction is 3 years; if you sell the car within that time -- don't own it a full three years -- you are subject to a prorated repayment of the monies you saved via the deduction, which is why some people who knew they were not going to keep the car three years did not bother to do the paperwork to take the deduction in the first place. I know that we weren't sure we'd keep our '01 Prius for three whole years, and so didn't take the deduction right away. The third year of ownership, we filed an amended return instead, claiming the deduction -- that was less work than trying to repay a prorated amount if we had sold the car within the time frame.

However, I knew I was keeping my '03 HCH for three years, and filed that one right away.

Hope this helps!
peace,
Linda