| There have been many credits recently added to the | | | | Sometimes people forget about sales tax especially. |
| tax code for new car buyers. The federal government | | | | This can cost you thousands of extra dollars when |
| is trying to help the car manufacturers and the | | | | buying a new car; so don't forget to include it in your |
| environment simultaneously by offering deep tax | | | | calculations. |
| credits for eco-friendly auto purchases. | | | | If you will be using your new vehicle for business |
| You can deduct both state and local taxes for new | | | | purposes, there are other tax deductions you can |
| cars purchased between February 16, 2009 and | | | | figure on receiving. Be sure to discuss these with your |
| December 31, 2009. In order to qualify, single tax | | | | accountant or tax expert before you make the |
| payers must have an Adjusted Gross Income under | | | | purchase, because the IRS has strict restrictions and |
| $125,000 and married couples must have an AGI under | | | | regulations when it comes to deductions for business |
| $250,000. | | | | vehicles. |
| The new plug-in hybrids are coming and tax incentives | | | | If you are planning to use your new car to carpool to |
| to buy these strictly battery powered cars are big. If | | | | work, your employer may offer incentives, as does the |
| you purchase one of the hybrids that run only on | | | | IRS. The Internal Revenue Service offers some |
| battery power, you can get a tax credit from $2500 | | | | deductions on carpool expenses to the car owner. Be |
| -$7500. The only catch is that you must be among the | | | | sure to discuss these with your tax expert or visit the |
| first 250,000 buyers. After that, the incentive | | | | IRS website in order to learn more. |
| decreases. | | | | Also check your State Department of Revenue to |
| When you are budgeting to purchase a new car, don't | | | | see what tax incentives they may be offering for the |
| forget to factor in the sales tax and registration fees. | | | | purchase of hybrids and plug-in automobiles. |