Credit for energy efficient vehicles
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If you buy an energy-efficient vehicle, such as one that runs on electricity or fuel cell technology, you may be eligible for a credit for an energy-efficient vehicle. The amount of the credit depends on the specific model and is based on the vehicle's fuel efficiency. Do I qualify for a credit for an energy-efficient vehicle? Eligibility requirements - You must place the vehicle in service during the current year. Only specified vehicle types and years (for example: 2012, 2013, 2014, etc.) qualify - You must use the vehicle primarily in the United States. - You must be the original owner of the vehicle. Used vehicles do not qualify. Limitations of this credit - If your credit is bigger than what you owe in taxes, the taxes you owe are reduced to zero, and the rest of your credit is lost.
Example: If you owe $375 in taxes, and you receive a credit of $500, the tax you owe is reduced to zero, and the remaining $125 is lost. You won't receive a refund for the remaining $125. - If you pay alternative minimum tax (AMT) and use the vehicle for personal use, you may be able to claim the credit against AMT. - If you use this vehicle for business and claim a depreciation deduction, you must subtract the credit amount when TurboTax asks you to enter the cost of the vehicle in the Business (Schedule C) or Farm section of the program.
Example: You paid $30,000 for your 2014 Nissan Leaf, which you use for your own business. The car is eligible for a credit in the amount of $7,500. To claim the depreciation deduction, you must subtract this credit amount when entering the cost of the vehicle in the Business or Farm section of TurboTax. You would enter $22,500 as the cost of the vehicle. Credit Limitations After a manufacturer sells a certain number of advanced energy-efficient vehicles in the U.S., the credit is reduced. For this reason you might not get the full credit amount. TurboTip: Available credit amounts are listed here: Plug-In Electric Drive Motor Vehicle Credit Amounts. Alternative Motor Vehicle Credit Amounts.
What paperwork do I need to claim a credit for an energy-efficient vehicle? To claim this credit, refer to your original purchase records for the vehicle. The manufacturer or domestic distributor can tell you the amount of the credit allowable for the specific make, model, model year you have purchased.
If you buy a plug-in electric drive motor vehicle often referred to as a plug-in hybrid electric drive (PHEV) or electric vehicle (EV), you may be eligible for the plug-in electric drive motor vehicle credit. This credit does not apply to used vehicles. The vehicle must be acquired after December 31, 2008 and placed in service in the current year. The credit varies and ranges from $2,500 to $15,000. The amount of the credit depends upon the battery capacity and weight limitations. Vehicles qualifying for this credit must be less than 14,000 pounds.
If you buy a qualified fuel cell vehicle such as a Honda FCX Clarity, you may be eligible for the alternative motor vehicle credit. This credit does not apply to used vehicles.
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