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IRS Explains Tax Credit for Fuel Cell Vehicles
The Internal Revenue Service issued guidance to taxpayers who purchase certified fuel cell vehicles regarding what they must do to use the tax credit. The notice issued included procedures for vehicle manufacturers to certify that such vehicles meet the requirements for a tax credit.
Currently, the amount of the tax credit available to purchasers of qualified fuel cell vehicles is based on the weight of the vehicle and when the vehicle is placed in service. An additional credit may be available for a fuel cell passenger automobile or light truck based on a comparison of the city fuel economy rating of that vehicle with the 2002 model year city fuel economy of a vehicle in its weight class.
For qualifying vehicles weighing less than 8,500 pounds, the base credit is $8,000 if the vehicle is placed in service on or before Dec. 31, 2009. The base credit amount is reduced to $4,000 if the vehicle is placed in service after that date. The amount of the credit available for heavy vehicles varies from $10,000 to $40,000, depending on the weight of the vehicle.
The notice also provided guidance regarding the conditions under which consumers may rely on the vehicle manufacturer's certification. The purchaser may claim a credit for the certified amount for a fuel cell vehicle if it is placed in service by the taxpayer after Dec. 31, 2005, and is purchased on or before Dec. 31, 2014.
According to http://www.fueleconomy.gov/ "many challenges, technical and otherwise, must be overcome before fuel cell vehicles will be a successful, competitive alternative for consumers." Manufacturers are still improving the efficiency of gasoline-and diesel-powered engines, and gasoline-electric hybrids are gaining popularity. FCVs will have to offer consumers a viable alternative, especially in terms of performance, durability, and cost, to survive in the ultra-competitive automobile market.
If you have any questions regarding qualifying for tax credits or other tax-related issues, please contact SLGG at 877.754.4557.
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Our firm provides the information in this e-newsletter for general guidance only, and does not constitute the provision of tax advice, accounting services, investment advice, or professional consulting of any kind. The information provided herein should not be used as a substitute for consultation with professional tax, accounting, legal, or other competent advisers. Before making any decision or taking any action, you should consult a professional adviser who has been provided with all pertinent facts relevant to your particular situation. Tax articles in this e-newsletter are not intended to be used, and cannot be used by any taxpayer, for the purpose of avoiding accuracy-related penalties that may be imposed on the taxpayer. The information is provided "as is," with no assurance or guarantee of completeness, accuracy, or timeliness of the information, and without warranty of any kind, express or implied, including but not limited to warranties of performance, merchantability, and fitness for a particular purpose.
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