Hybrid cars qualify
for a tax break
April 2004
There's been a lot
of recent publicity about the tax breaks available for large sport
utility vehicles. When used as business vehicles, SUVs are not subject
to the same depreciation limits as cars.
A tax break that
every taxpayer can use is the deduction allowed for the purchase of a
new hybrid gas/electric car. You don't have to use the car in business
to get the deduction, and you don't have to itemize deductions on your
tax return to benefit from this tax break.
The IRS has
certified the Honda Insight, the Honda Civic Hybrid, and the Toyota
Prius as eligible for this clean-fuel vehicle deduction.
The taxpayer must
be the original owner of the vehicle, and the deduction is taken in the
year of purchase. The maximum deduction for 2004 is $1,500; for prior
years it was $2,000. If you didn't take the deduction for a qualifying
hybrid car you purchased in 2001, 2002, or 2003, you can file an amended
return and get a refund.
For additional
information or filing assistance, give us a call.
Return to 2004 Tax Tips
