Considering a
Hybrid Car?
Claim a tax credit along with savings on gas
With the price of gasoline remaining high, you may be
contemplating your transportation alternatives. Purchasing a new hybrid
vehicle may be the answer. But which one? Various makes and models are
available and each carries a different tax credit amount.
The tax credit for hybrid vehicles applies to vehicles purchased on or
after January 1, 2006, and may be as much as $3,400 for those who purchase
the most fuel-efficient vehicles. The hybrid vehicle certifications* and
their credit amounts are:
* 2005 Toyota Prius – $3,150
* 2006 Toyota Prius – $3,150
* 2006 Ford Escape Hybrid Front WD – $2,600
* 2006 Honda Civic Hybrid CVT – $2,100
* 2005 Honda Civic Hybrid (SULEV) MT – $1,700
* 2995 Honda Civic Hybrid (SULEV) CVT – $1,700
* 2005 Honda Insight CVT – $1,450
* 2006 Honda Insight CVT – $1,450
* 2006 Honda Accord Hybrid AT – $1,300
* 2005 Honda Accord Hybrid AT – $650
* 2006 Ford Escape Hybrid 4WD – $1,950
* 2006 Mercury Mariner Hybrid 4WD – $1,950
* 2006 Toyota Highlander 2WD Hybrid – $2,600
* 2006 Lexus RX400h 2WD – $2,200
* 2006 Lexus RX400h 4WD – $2,200
* 2007 Toyota Camry Hybrid – $2,600
* 2007 Lexus GS 450h – $1,550
The maximum credits are only available for a limited time. You may claim
100 percent of the allowable credit up to the end of the first calendar
quarter after the quarter in which the manufacturer records its sale of
the 60,000th hybrid vehicle.
For the second and third quarters after a
manufacturer reaches 60,000 hybrid sales, the credit is reduced by 50
percent and in the fourth and fifth calendar quarters, the credit drops to
25 percent. No credit is allowed after the fifth quarter. Be sure to ask
the dealer whether the manufacturer has sold 60,000 vehicles.
*More makes and models may become certified for tax credits in the future.
