Hybrid Car Tax Credit – A Great Way to Save Money

Qualified vehicles purchased on or after 1st of January, 2006, will be entitled for a tax credit ranging from $400 to $3,400 based on its fuel saving. The hybrid car tax credit is a combination of two different tax credits. The math in this computation is very complicated, and luckily you won’t have to do it. The auto manufacturers and the IRS will be responsible to certify the tax credit amount.

The Hybrid Tax Credit may be brief, depending on customer demand for the fresh hybrid cars and trucks. The value of the tax credit would start to decrease once the manufacturer has sold 60,000 or more qualified cars. The phase-out will start at the auto manufacturer level. The well-known brands may see their tax credits decreased sooner than less popular brands.

Taxpayers may claim the full amount of the credit up till the end of the first quarter after the quarter in which the manufacturer records its sale of the 60,000th vehicle. For the second and third quarters following the quarter in which the 60 000th automobile were sold, people may claim 50 percent of the credit. For the fourth quarter, the taxpayers may claim their twenty five percent of the permissible credit.

The government has qualified diverse makes and models for this hybrid tax credit. These certifications set the utmost dollar value that your tax credit will be. Your tax credit may reduce by various limitations.

Under guidance released by the IRS, auto manufacturers can provide you a certification specifying the amount of your hybrid tax credit. The IRS dictates that the producer’s certification should have the subsequent 16 essentials: Name, tax identification number of the manufacturer, and address; Make, model year, model, and other identification information; A written statement that the vehicle was made by the manufacturer itself; The kind of credit for which the automobile qualifies; The amount of the tax credit (shows all the computations); The gross weight of the vehicle; The vehicle weight class; The city’s fuel economy of the vehicle; Statement that the vehicle does complies with the provisions provided on the Clean Air Act; A Copy of the certificate that proves that the vehicle meets the emission standards set by the government under the Clean Air Act; A statement that the motor vehicle comply with state’s air quality control law; Statement that the vehicle complies with certain motor vehicle safety provisions; Statement that the motor vehicle uses a hybrid technology both rechargeable energy storage system and an internal combustion; Statement that the motor vehicle meets or exceeds California’s low emissions vehicle standards; proof that the motor vehicle does not go beyond the maximum power standard. Perjury statement are as follows: “Under penalties of perjury, you declare that you have examined this certification, as well as supplementary documents, and to the best of your awareness and belief, the facts on hand in support of this qualifications are true, correct, and complete. Keep this tax documentation for at least four years, because you will never know whether you will be able to use these again in the future.

Hybrids Just Might Save the Day – And Your Morning Commute

“Yeah, I’ve thought about buying a hybrid car,” said Stephanie. “Especially with the gas prices. But, they confuse me. I’ve heard there are a bunch of types, and I’m not sure which brand gets what kind of mileage or how they’re supposed to work or…I mean, I don’t want to get stuck on the road somewhere and not even know how to check the oil, do I?”

No, not really. Stephanie, a resident of San Francisco, could just be more cautious than most. She may be living in one of the most eco-conscious spots in the country, but it doesn’t mean she has any more mechanical know-how than anyone else. According to one study, even those who have already purchased hybrids usually don’t know how they work. The most common buyers seem to be of the “green” variety or those who made their purchase for environmental reasons.

Indeed, the same study revealed that many hybrid buyers had not looked under the hood. Instead, they might have used the instrumentation as the source for understanding their cars. According to the findings, most hybrid households made their purchases for three basic reasons: desire for independence and control, drive to preserve the environment and the appeal of new technology.

It seems more and more of the populace is perfectly comfortable owning, but not understanding, how hybrid automotive technology works. According to automotive research, sales of new hybrid cars increased by 38% in 2007, adding approximately 350,000 to the road. And, according to an environmental web site, March 2008 saw the second highest monthly total for hybrid sales ever, at 38,214 units – despite an overall drop in new automotive purchases. This was a 10% increase from last March. That’s something when considering hybrids only scraped up 0.5% of market share in 2004.

Intrigued? In case you want to jump on the bandwagon but don’t want to do it blindly, here’s the lowdown on basic types of hybrids:

(1) Micro Hybrid

The basic definition of a hybrid vehicle is very simple: It’s a vehicle that combines two or more power sources to provide power. Typically, hybrids currently on the market are hybrid-electric vehicles (HEVs) powered by fuel and electricity. In a micro hybrid, none of the actual driving power comes from the electric motor. Instead, the typical alternator is replaced with an electric motor that is both the starter and alternator. When the vehicle comes to a stop the engine stops running to conserve fuel. When the driver takes his foot from the brake, the engine restarts using the electric motor. These systems are commonly called Start/Stop and can reduce fuel consumption by 5% to 15%.

(2) Mild Hybrid

In a mild hybrid, the electric motor functions similar to a micro system; however, in addition to starting the engine and charging the battery, it may also provide supplementary torque to the fuel-burning engine to help propel the vehicle. In ideal conditions, this motor can provide up to 10% of the total power. Besides stop/start and regenerative braking, mild hybrids also include higher levels of battery power to run vehicle accessories when the engine is off. Average fuel savings ranges from 15% to 25%.

(3) Full Hybrid

The full hybrid can be driven solely by the electric motor, fuel-burning engine or a combination of both. It is sometimes called a “parallel or dual mode hybrid” because both the engine and motor are hooked up in parallel to the same transmission. A “full electric launch” is what sets the full hybrid apart from the first two; the car can be started and driven without guzzling gas. The electric motor is capable of providing about 40% of maximum engine power as additional torque. They tend to be more expensive because they require more powerful motors and battery systems. Fuel savings is substantial – as much as 65%.

(4) Serial Hybrid

Serial hybrids are essentially electric cars that have a small internal combustion engine (ICE) used to generate electrical power. A serial hybrid is sometimes referred to as a “series” hybrid because the ICE connects in series to an alternator which generates electricity, which then flows to the storage battery. The ICE only runs when the electric batteries drain to a certain level, recharging them. Fuel cells can also be used in place of the ICE as a power source to generate the electricity that charges the battery.

Whatever the hybrid type, the vehicle’s ultimate capabilities will depend upon the power of the electric motor, efficiency and type of fuel engine (gasoline or diesel), the sophistication of the engine and powertrain management software and the capabilities of the battery. New technologies eliminating or improving conventional engine parts, such as the transmission, will also affect performance and fuel efficiency.