After cost basis is reduced, the remaining basis can be depreciated or expensed as a Section 179 deduction. The vehicle must be used for your own personal or business use. Based on 10,000 miles/yr. Table of ContentsAlternative Motor Vehicle Tax Credit: Basic Info and Qualifications (page 1)Alternative Motor Vehicle Tax Credit: Limitations, No Carryover, Tax Strategies (page 2)List of All Vehicles Eligible for the Alternative Motor Vehicle (page 3)Phaseout Time Periods and Dollar Amounts (page 4). The alternative motor vehicle tax credit will begin to phase out once a manufacturer sells more than 60,000 qualifying vehicles. In buying a new Toyota RAV4 Hybrid or new Toyota Prius Prime Plug-In, you’ll save money not only at the pump, but at tax season. What are the different types of hybrid cars? On approved credit. For now, we would advise against selling, leasing, or giving hybrid cars away until we find out how long you have to keep the car. We also share information about your use of our site with our social media, advertising and analytics partners who may combine it with other information that you’ve provided to them or that they’ve collected from your use of their services. You Might Qualify for a Tax Credit If You're Elderly or the Disabled, DrivePlus Mastercard Review: Best for Prospective Chrysler Buyers. ...Additional options inside the Toyota selection add the $15,600 Yaris, the actual $19,600 Corolla, and also the $24,295 Camry. For example, U.S. News and World Report and Edmunds report that you can receive a $4,502 tax credit if you purchase the plug-in Toyota Prius Prime hybrid hatchback. However (and this is a big however), We would caution you to wait until the IRS releases regulations to interpret this new tax law before entering into such an arrangement, just to make sure you are fully eligible to take advantage of the alternative motor vehicle tax credit. If your business does not qualify for the Section 179 deduction, you can take advantage of another tax break – bonus depreciation. The other criteria relate to the fuel economy and energy efficiency of the vehicle. Begins: April 1, 2009.100% credit: for eligible vehicles purchased before April 1, 2009.50% credit: for eligible vehicles purchased between April 1, 2009, and September 30, 2009.25% credit: for eligible vehicles purchased between October 1, 2009, and March 31, 2010.0% credit: for vehicles purchased April 1, 2010, or later. Here are the 50% credit amounts for January 1, 2008, through June 30, 2008: Here are the 25% credit amounts for July 1, 2008, through December 31, 2008: Begins: October 1, 2006.100% credit: for eligible vehicles purchased before October 1, 2006.50% credit: for eligible vehicles purchased between October 1, 2006, and March 31, 2007.25% credit: for eligible vehicles purchased between April 1, 2007, and September 30, 2007.0% credit: for vehicles purchased October 1, 2007, or later. However, unless these credits are extended, they expired at the beginning of 2020. Find your perfect car with Edmunds expert reviews, car comparisons, and pricing tools. Refundable vs. Nonrefundable Tax Credits—Which Is Better? The new law for the alternative motor vehicle tax credit requires taxpayers to recapture their hybrid tax credit if they re-sell their hybrid car or truck. (Nov. 15, 2010)http://www.plugincars.com/federal-and-local-incentives-plug-hybrids-and-electric-cars.html, Vaidyanathan, Shruti. 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