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Is $7500 tax credit lost if you are subject to the Alternative Minimum Tax?

Discussion in 'Electric Vehicles' started by swegman, Jul 10, 2012.

  1. swegman

    swegman Member

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    I have to check with my accountant regarding the $7500 federal tax credit on the Model S. I was talking to two different auto dealers (Toyota and Chevy) regarding the Pruis plug-in model and the Volt. The dealers indicated there is a federal tax credit for the vehicles. However, they stated that if one is subject to the Alternative Minimum Tax, you lose the federal tax credit. Anyone know whether this is correct. I have been subject to the Alternative Minimum Tax for years (an assume many on this site are also subject to it), and if the tax credit is lost, the cost of the Model S has just become $7500 more expensive than I expected. Any accountants out there?
     
  2. Sousaphil

    Sousaphil P2,595

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    I think that's a load of BS from the dealers. Didn't Toyota run out of their credits a while ago?
    My accountant looked it up when he prepared my 2011 return (just to evaluate what to expect for 2012). There was no mention of AMT restrictions.

    Furthermore, considering many of Tesla's customers (current and future) also are subject to the AMT, so I seriously doubt they'd be able to talk up the credit as much as they have.
     
  3. TEG

    TEG TMC Moderator

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    It is my understanding that the $7,500 EV credit is NOT subject to AMT reductions.

    This is different from the old hybrid decuction which was subject to AMT, so some dealers could be confused about it.
    But, seek a second opinion! I am NOT a tax advisor.

    Also, on the MyNissanLEAF forum a lot of buyers reported having SNAFUs with their filings, having the credit rejected by the IRS due to processing errors. Many are working to straighten it out.
    Mine sailed through without any hassles.
     
  4. Lloyd

    Lloyd Active Member

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    My understanding is if you have a federal tax liability it will apply against it. Pretty simple. I'm not an accountant.
     
  5. rbmartin

    rbmartin Model S Sig. 517

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    It goes on line 53 of your 1040, so it gets subtracted from your total tax, AMT or otherwise. Look at IRS form 8936.
     
  6. NigelM

    NigelM Recovering Member

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  7. hcsharp

    hcsharp Active Member

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    It's not subject to AMT. The credit is partially based on battery capacity and the Toyota PIP probably doesn't qualify for the full credit because its battery is not big enough.

    Mods: consider moving this thread to the existing thread that answers a lot of Q's about the $7,500 tax credit.
    Oh I see NigelM hit the Send button as I was typing...
     
  8. bonnie

    bonnie Oil is for sissies.

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    I've asked the mod of the Electric Vehicles forum to take a look. Thanks for listing suggested threads. That makes it easier for us.
     
  9. strider

    strider Active Member

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    My wife and I are in AMT and we qualified for the $7,500 Federal credit for our Roadster. No worries. The EVSE credit from last year however was disallowed in AMT so din't get to claim that one :(
     
  10. mulder1231

    mulder1231 Active Member

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    Can't wait for Obama to raise the amount from $7,500 to $10k and make it an instant rebate instead of a tax credit.
     
  11. gg_got_a_tesla

    gg_got_a_tesla Model S: VIN P65513, Model 3 Res Holder

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    That's probably a pipe dream, Erik. Even if he gets reelected, the Democrats will not get both houses so, that's that...
     
  12. mulder1231

    mulder1231 Active Member

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    Could be part of a budget w/ tax-breaks-for-the-rich compromise deal. And with the current projection for EV sales the cost to tax payers is very modest.

    I'm still holding out hope :wink:.
     
  13. cruisersl

    cruisersl New Member

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    The AMT will not reduce or eliminate the 7.5k credit for a Tesla: per IRS rules, here is the answer: Energy Incentives for Individuals: Questions and Answers

    At the very bottom of the article, it says: "Q. Does the Alternative Minimum Tax (AMT) impact the alternative motor vehicle credit?A. Starting in 2009, the new law allows the alternative motor vehicle credit, including the tax credit for purchasing hybrid vehicles, to be applied against the alternative minimum tax. Prior to the new law, the alternative motor vehicle credit could not be used to offset the AMT.
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