Electric Vehicle Forums - Tax Credit Confusion

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Tax Credit Confusion

So my tax person completed my taxes and I noticed I only got $2039 or my $3150 tax credit for my 2007 Prius purchased last September. Can anyone explain in simple terms why I didn't get the full amount?

Did the Feds just pull one over on the consumer?

Re: Tax Credit Confusion

http://www.sfgate.com/cgi-bin/articl...DGC7N75RT1.DTL

Never mind, this link explained it all. We've been had!

Re: Tax Credit Confusion

All I can say is this is the most ________ thing I have every seen.

you can fill in the blank.

Mac.

Re: Tax Credit Confusion

I think the way they advertised it, everyone believed you would get the full $3150 tax credit. I'm getting the feeling the Feds don't want us in this technology. And people that aren't pro Hybrid don't want to pay more for a vehicle with it. Money motivates and if the technology can't get less expensive, people won't buy it. And now with the new mileage rating system which reflects a lower mpg, those people that were on the fence about Hybrids aren't crossing over if there are no decent tax breaks.

Re: Tax Credit Confusion

In doing my taxes with Taxcut.com I noticed that without my investments (not totalling anywhere near $750,000) the tax credit was very small, but once I put in my investments it came up to the full amount of $3500. I don't know what crazy logic is behind it but, it was interesting to notice. As a guess, generally speaking the rich have a lot of investment income and the poor have only working income, so like many other tax breaks passed in the past 6 years perhaps that was its goal.

A little-known trick is that you can make contributions to many types of investments this year as though you made them last year, for tax purposes. You're missing out on the interest/appreciation you would have made, but depending on how the numbers work out, you may dodge a lot of taxes via the loophole. Give it a shot - I did my best to not pay a dime for this war, may as well do yourself a favor and keep your money out of it too.

Re: Tax Credit Confusion

Quote:

Originally Posted by SoopahMan (Post 117864)

I'm curious soopahman, was a lot of this investment income interest from money markets, bonds, and dividends as oppossed to capital gains?

My guess if you have lots of interest income you are being taxed on this at either a 28% or 33% rate, and if so your being taxed at a higher rate for this than the AMT and that could explain why you now get the full deduction.

I understand your wish not to pay for the war, but it simply doesn't work that way. You're just keeping more of your own money, nothing wrong with that, but the war doesn't know that.

I could justify my desire to avoidance paying taxes as not wanting to pay for farm subsidize, or welfare, or aids research, or Bush's salary, but we don't get to target our tax payment.

Re: Tax Credit Confusion

Yeah, I only got $300 of my $2100 for my HCH. Mostly becasue my income "is at the poverty line" (I'm a student) and only paid $400 in federal taxes to begin with, I'm getting all the federal taxes I paid back. I've just decided that at least I have a car I like. Money is always nice but I love my car and that's what counts..

Re: Tax Credit Confusion

I checked this credit out before buying my new 2007 HCH. Being single, and even with itemized deductions for the house, state and local income taxes, contributions, etc., I will still get the full $2,100 when I file next year (using 2006 forms versus 2007 which will be in effect then). Also, Colorado supports the alternative vehicles, with a $2,756 tax deduction for the HCH.

Re: Tax Credit Confusion

Quote:

Originally Posted by worthywads (Post 117866)

I'm curious soopahman, was a lot of this investment income interest from money markets, bonds, and dividends as oppossed to capital gains?

Mostly money markets.

I'm not naive to how taxes work - but since nearly half of the tax money I pay goes to the military in some form, the more of my own money I keep from the government the less I pay for the war. This can't be said for something like farm subsidies because they're a miniscule part of the budget.

Re: Tax Credit Confusion

Quote:

Originally Posted by erscolo (Post 118111)

.. I will still get the full $2,100 when I file next year (using 2006 forms versus 2007 which will be in effect then).

Did you do the AMT form too? For most people, using the hybrid tax credit form (8910) is also the first time they have ever had to also fill out the AMT form (6251).