Hybrid Car Tax Credit
Encouraging Low Fuel Consumption Cars

The Hybrid Car Tax Credit goal is to encourage the sale of more hybrid cars. Hybrid cars are exhibiting more miles per gallon than conventional cars, therefore more hybrid cars mean less nationwide fuel consumption.

Hybrid Car Definition

Hybrid cars have drive trains powered by both an internal combustion engine and an electric motor driven by a rechargeable battery. Many currently available hybrid vehicles are qualified for the tax credit

Tax Credit

A tax credit is subtracted directly from the total amount of federal tax owed and can be filed on the tax payer tax return form

Tax Credit Rules

The tax credit can be claimed on new cars by the original buyer. A leaser can claim the tax credit on his tax return
The car should be on the qualified cars list
Buy early; the full credit is only available for a limited time. Taxpayers can claim the full amount of the allowable credit up to the end of the first calendar quarter after the quarter in which 60,000 hybrid cars of the specific model were sold.
For the second and third calendar quarters after the quarter in which 60,000 cars were sold, taxpayers may claim 50 percent of the credit.
For the fourth and fifth calendar quarters, taxpayers may claim 25 percent of the credit. No credit is allowed after the fifth quarter
No credit is allowed after the fifth quarter