2006 NAIAS Detroit Auto Show :: More Hybrid Cars Qualify for Tax Cuts

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2006 NAIAS :: Reviews and Interviews

More Hybrid Cars Qualify for Tax Cuts

PHOTO BY JASON RZUCIDLO / AMERICAJR.com

The Ford Escape Hybrid won Truck of the Year honors at last year's auto show.

by Jason Rzucidlo

AmericaJR@AmericaJR.com

As of January 1, 2006, more new and improved tax credits went into effect for drivers of hybrid cars. These tax credits will be higher than the ones that were previously given by the federal government.

You can now get a tax credit if you are a driver of a Ford Escape Hybrid, Honda Accord Hybrid, Honda Civic Hybrid, Honda Insight, Lexus RX400h, Mercury Mariner Hybrid, Toyota Highlander Hybrid, Toyota Prius, Chevy Silverado, GMC Sierra, Lexus GS450h, Nissan Altima or the Toyota Camry.

In order to receive a tax credit, there are some rules. You must purchase the vehicle new and not used. You must keep it for a period of time and not re-sell it. If you resell your hybrid car or truck, you will be required to pay for the credit on your own.

Here's how it works. Each automaker listed above has a limit of 60,000 cars that will offer a tax credit. After 60,000 hybrids are sold by a single automaker, the tax credit will be cut in half. Each time and automaker sells another 60,000 hybrids, their tax cut is cut in half again. After the second time the tax credit is cut in half, it will end completely.

Toyota has been selling the Prius and they are nearing the cut-off period. If you want to get a high tax cut, I would recommend that you buy now!! They have been selling about 10,000 Prius hybrids each month.

How is the amount of the tax credit determined? It depends on the weight of the vehicle, it's fuel economy and the amount of emissions released. The biggest credit goes to the Toyota Prius and it is $3,150.

Hybrid Tax Credits (estimates)
Make	Model	Estimated Tax Credit
Ford	Escape Hybrid (2wd)	$2,600
Ford	Escape Hybrid (4wd)	$1,950
Honda	Accord Hybrid	$650
Honda	Civic Hybrid (auto)	$2,100
Honda	Civic Hybrid (manual)	$1,700
Honda	Insight (auto)	$2,600
Lexus	RX400h	$2,200
Mercury	Mariner Hybrid	$1,950
Toyota	Highlander Hybrid (2wd)	$2,600
Toyota	Highlander Hybrid (4wd)	$2,200
Toyota	Prius	$3,150
Chevrolet	Silverado	$250
GMC	Sierra	$250
Lexus	GS450h	$1,300
Nissan	Altima	$1,300
Toyota	Camry Hybrid	$1,300

Source: Hybrid Cars - Hybrid Car Legislation

This will be the first time that tax credits will be offered on American hybrid cars. The previous tax credit only applied for foreign hybrids such as the Honda Insight, Toyota Prius and others. There is more of a selection now than there was before. You have more choices if you are looking to get a tax credit and a hybrid car at the same time.

In order for a car to make the list for a tax credit, they must be certified. They must meet the standards set by the U.S. Environmental Protection Agency (EPA) or the California Air Reintroduces Board (CARB) or both agencies.

Some states offer an addition tax credit for a consumer who buys a hybrid car. Michigan is not one of the states offering an additional credit. Some states that offer additional incentives include Arizona, California, Colorado, Connecticut, Washington D.C., Florida, Georgia, Illinois, Louisiana, Maine, Maryland, Massachusetts, New Mexico,, New York, Oregon, Pennsylvania, Utah, Virginia, Washington state and West Virginia.

Why drive a hybrid? They lessen our dependence on foreign oil. You will be helping to save the environment. They improve the miles per gallon in the city and in the highway. For example, the Toyota Prius gets 60 mpg in the city and 51 mpg on the highway. Those numbers are amazing. The Honda Insight offers 57 mpg and 56 mpg respectively. It will cut the cost of gasoline in half.

Ford Motor Company is one automaker that is committed to our future. They are working to develop and produce more hybrids. They are also working to create cars than run on ethanol (corn oil). Ford is also working on building cars and trucks that run on Hydrogen, the future of automobiles. The Mercury Mariner recently won the "Green Car of the Year" Award. Ford wants to produce 250,000 hybrids each year by the year 2010.

PHOTO BY JASON RZUCIDLO / AMERICAJR.com

The Toyota Prius won the "Car of the Year" award at the 2004 NAIAS.

Source: Hybrid Cars - Hybrid Car Legislation


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