Don't Mess With Taxes

For the first time ever, the national average of regular gasoline hit $3-plus a gallon in November. And that's before any of us even start our cars to head over the river and through the woods to grandma's for Thanksgiving. Anyone want to venture a guess on what the per-gallon pain will be in a couple of weeks ... or by Christmas? One expert says it won't be so bad. Oil Price Information Service analyst Tom Kloza told USAToday that while pump prices have a little bit of catching up to do to reflect the recent surge in oil costs,... Read more →

If you want a Toyota or Lexus hybrid and a federal tax credit on your 2007 return, you've got to drive one of them off the lot by Sept. 30. On Oct. 1, the tax breaks for the Japanese car maker's fuel-efficient vehicles vanish. As I've recounted many, many times before, Toyota is a victim of protectionist tax writing, designed to help the domestic automakers who are well behind in this technological race. The section of the Energy Policy Act of 2005 that created the alternative-fuel vehicle credit, mandates that once a manufacturer sells 60,000 eligible vehicles, it starts losing... Read more →

There's just over a month left of summer and summer vacation driving. And gasoline prices are holding, across most of the United States, around $3 a gallon. I just love this GasBuddy.com map. Right click on your county -- Yeah, I know; they're kind of small. I needed my reading glasses to find Travis County -- and you'll find the day's average price there. Anyway, if you just got back from a long road trip and are facing the incoming gasoline charge card bills, you might be thinking about trading your vehicle for a more fuel efficient one. Some of... Read more →

The price of gas nationally continues to hang in the $3 a gallon range. So what are drivers doing? Buying more SUVs for summer vacations. In a report last week on NPR's Morning Edition, the editor-in-chief of Car and Driver magazine explained the surprising numbers. According to Csaba Csere, today's most popular sport utility vehicles are a different animal. The best-selling SUV models, said the C&D editor, are the Honda CRV, Ford Escape and Toyota RAV4, all of which are smaller vehicles. Also, most SUV sales now are crossovers, based on car platforms, not trucks, so they get better gas... Read more →

Lots of folks will be leaving work early today, getting a head start on Memorial Day travel. But the trip will not start on a happy note for most. That's because most of this weekend's 38 million travelers will be driving and they'll have to fill up their cars before hitting the road. Given the pump prices -- I saw a station charging $3.44 when I was in Seattle -- it's going to be an expensive getaway. And since this is the just the beginning of the summer driving season, don't expect any gas price relief any time soon. I... Read more →

First off, I have no vested financial interest in Toyota's bottom line. Neither I nor any relative works for the company in any capacity. Neither do I personally care. I don't own one; have always driven Chevys. Finally, I question the effectiveness, not to mention the fairness, of the hybrid vehicle tax credit. But it's on the books and I'm a firm believer in taking advantage of tax laws that can save a few bucks. (And speaking of tax savings, in case you missed the 12 tax credits list posted yesterday, of which the hybrid write-off is one, here's the... Read more →

Gas prices have bumped back up, but the tax break for Toyota hybrid vehicles is heading down again in less than a week. Toyota buyers who got one of these fuel-efficient autos by Sept. 30, 2006, got the best tax deals for that make. Last Oct. 1, Toyota's credit amounts were cut in half. In a few days -- April 1, no joke -- the credit will be reduced again. And this Oct. 1, the Toyota tax break will disappear completely. The reason, as everyone is well aware of by now, is that lawmakers decided to give a break to... Read more →

I'm going out to fill up my car today. Gasoline here in my part of Austin is back below $2 a gallon. That's good news for me and other drivers of conventional autos. And it could be equally good news for folks who want to shift to a hybrid. As gas prices have fallen nationwide, the maker of the most popular hybrid model is looking at new and heretofore unfamiliar ways to move these vehicles off dealer lots. Yes, the Prius, preferred ride of Hollywood stars and hip hybrid fans elsewhere, is now just another auto option. Sales of Leo... Read more →

The first Nissan is now on the Alternative Motor Vehicle Credit list. The 2007 Altima hybrid will net purchasers a $2,350 credit on their 2007 returns next year. Yes, most of us haven't filed or even started our 2006 taxes and we're already getting info on next year's returns. But the good thing about that is it gives us plenty of time to plan. Speaking of planning, if you want a Toyota hybrid, to get the current tax credit amounts, you must buy one by March 31. Right now the largest credit is $1,575 for a Prius. On April 1,... Read more →

Want a Toyota hybrid but are unhappy that a purchase now will get you a much smaller tax break than buyers got a few months ago? You're not alone. Toyota executives are calling for extension of the full tax credit for the Japanese automaker's popular hybrids, according to various wire service reports (Reuters, AP). Toyota's North American president, Jim Press, says sales of its hybrids have plummeted since the full credit expired in October. The most popular vehicle, the Prius, began the year with a $3,150 tax credit. Because Toyota has already sold more than 60,000 of such vehicles (well... Read more →

The IRS has certified three 2007 Hondas as eligible for the Alternative Motor Vehicle tax credit. As regular readers know, this is the tax break that took effect on Jan. 1, 2006, and provides a credit instead of deduction for cars that meet certain environmental standards. Since a credit, which provides a dollar-for-dollar reduction of your tax bill, is better than a deduction, which reduces your taxable income and then should lower you tax bill, the change is welcome. What isn't welcome is the complexity of the credit. The tax break is calculated for each eligible vehicle and how many... Read more →

Not to pick on a company when it's down, but GM is running on fumes as far as its hybrid vehicle program goes. Maybe that's one reason the company has decided to produce yet another Hummer model, a new truck version expected in showrooms in 2009. Hmmm. Making a gas guzzler when some oil industry analysts are predicting the fossil fuel will eventually hit $100 a barrel. Seems like we went down this highway, or at least the frontage road, not too long ago. OK, that triple-digit prediction is a ways off, but in the nearer term, you can be... Read more →

If you bought an older Ford hybrid this year, you might be able to take tax advantage of the purchase on your 2006 tax return. The IRS announced Friday that it has certified that two of Ford's 2005 hybrids meet the new alternative fuel tax credit. The latest blue oval additions are: 2005 Escape two-wheel-drive, eligible for a $2,600 credit, and 2005 Escape four-wheel-drive, eligible for a $1,950 credit. Earlier this year, Ford's 2006 Escape hybrids, both two- and four-WD models, were certified at the same credit levels as the just-added 2005 versions. You can find a full list of... Read more →

Sure, Toyota and Lexus hybrid buyers are now getting just half the original tax credit for their energy-conscious auto purchases. But at least they have a few more reduced-credit choices. The new tax break for fuel-efficient hybrids was created to encourage drivers to switch from fossil-fuel-only vehicles. But, as discussed in these previous posts, (note: when you click this link, this entry will show up first since it's the latest one tagged "hybrid," so scroll down for the earlier ones) the amount of credit a taxpayer can claim is reduced once a car maker sells 60,000 hybrids. In some cases,... Read more →

No, I'm not talking about the oft-maligned used-car salesmen. I'm talking about you, me and the guy down the street when we buy our cars from each other instead of a dealership. According to state officials, person-to-person deals account for around one-third of used-car sales in the Lone Star State. A new Texas law that takes effect today, Oct. 1, is designed to stop the shorting of tax collection on autos sold via such private transactions. You've seen the classified ads: "For sale. 2000 Chevy Cavalier. Great condition (recently tuned up). Low mileage. A steal at $4,000." When the used-Chevy... Read more →

Time is rapidly running out for a tax break available to purchasers of fuel-efficient autos produced by Toyota or Lexus. You just have until Sept. 30 to buy one of the Japanese automaker's hybrid models in order to claim the full tax credit on your 2006 tax return. Come Oct. 1, the credit is slashed in half for each Toyota/Lexus hybrid model. If you can drive off a dealer's lot in just a little over a week, you can claim one of the following credits next filing season: 2007 Toyota Camry Hybrid -- $2,600 2007 Lexus GS 450h -- $1,550... Read more →

If you're a fan of the Prius and you want to take full advantage of the new tax credit available to purchasers of the hybrid, you better get to a dealership soon. As mentioned in this earlier post, Toyota hybrids have been big sellers this year and under the law that created the tax credit, that means buyers could soon lose part of the tax break. When Toyota hybrid sales, including the manufacturer's IRS-certified Lexus models, reached 60,000 in June, the full tax credit started phasing out. Details on that process can be found in this blog entry (60,000 countdown... Read more →

OK, I swear I'll get off the hybrid car kick ... as soon as the IRS does. Remember my June 9 post that mentioned how some companies are giving their employees extra cash to help them buy hybrid vehicles? No? Then you can re-read it here, about halfway down. Well, today the IRS issued a release alerting such workers that just as there's no free lunch, there's no tax-free commute. According to the tax agency, employer cash to help defray a hybrid purchase is taxable. Such "rebates" or cash incentives to employees for buying these fuel-efficient vehicles are just like... Read more →

I was going to take down the hybrid vehicle poll results yesterday, but two things stopped me. First, TypePad crashed. OK, it only partially crashed. You still could read the blog, but when I went to update it Wednesday afternoon, I couldn't. And, secondly, by the time I was able to get around to tweaking the blog, more hybrid data had come down the pike. Specifically, the IRS announced additional vehicles that could help you save gas and cut your 2006 tax bill. So with the IRS starting to resemble an auto dealership, releasing yet more data on vehicles that... Read more →

Toyota hybrid vehicle buyers who dally this summer are likely to miss out on the maximum Alternative Motor Vehicle Credit (discussed in this earlier post), but Ford fans still have plenty of time, and a couple more automotive choices, to get the full tax break. The IRS says that Ford's 2007 Escape hybrids (front and four-wheel drive models) and its new Mercury Mariner four-wheel drive now qualify for the credit. Below is the complete list, to date, of vehicles by manufacturer and the maximum available credit that purchasers can claim on their tax returns next year: Ford/Mercury 2007 Ford Escape... Read more →