[sjerseycraig]

now don't hold me to this, but I had a chance to skim the new energy bill that the House and Senate conferres agreed on. I'm not a tax lawyer, heavens knows, but it appears to enact a tax credit for buying a hybrid. The better the fuel economy of the hybrid, the greater the credit.

This appears to be a credit, not a deduction. A credit can be taken directly off your taxes, while a deduction simply reduces your tasable income.

Talk to your tax adviser; please don't rely on this posting to tell you what to do.

 

[ehurtley]

Oregon has a credit toward the Oregon state income tax, but having a federal credit would be nice, too.

 

[DanMan32]

I looked it over using the link on PriusChat. It does indeed say Credit.
The credit is based on percent increase in mileage from city average in MY2002 for different weight classes. The new Prius is about 3000 lb, so the avg 2002 city miles was 28.8MPG for that class. The Prius is rated at 60 MPG, which is just over 200%. Therefore you get $2000 credit.

No sign that it is retroactive though. Drat!

 

[hyperion]

What if you stipulated that your 2002 was a 4 runner that got 14 mpg. Are we going into "blue book" figures?

 

[jacqueusi]

hyperion, the mileage standards are posted in the text of the bill. They decide MPG not us as I had originally thought.

Also, I believe the MPG rating is for Combined, so at 55 MPG as est. by the EPA, we are still within the 200% threshold.

 

[sjerseycraig]

perhaps I misread . . .

but it seemed to me that the new credit is based on:

a. the percentage by which the car exceeds the average city mileage for autos; and

b. the number of gallons of gasoline that the car would use over the course of a certain number of miles (I think 100,000).

 

[exhuman]

The heading on the table says:

"The 2002 model year city fuel economy is:"

For this reason I think the city mpg of 60 should be used in the credit determination. Also, I believe the "inertia weight class" of the Prius is 3000 yielding a 2002 model year mpg of 26.4. 60/26.4 = 2.27 or 227%. I think this is just over the 225% needed to get us a $2000 credit.

 

[jacqueusi]

exhuman, you are correct! I totally missed the City reference. Also, I was reading from the Fuel Cell and not Hybrid section. 225%-250% for a $2,000 tax credit.