The Internal Revenue Service has certified the 2006 Toyota Highlander
Hybrid as being eligible for the clean-burning fuel deduction. This certification
means that taxpayers who purchase one of these hybrid vehicles new during
calendar year 2005 may claim a tax deduction of up to $2000 on Form 1040.
Under
Working Families Relief Act of 2004, which was signed into law in October
of 2004, the clean-burning fuel deduction is limited to up to $2,000 for
certified vehicles first put into service in 2005 and $500 for vehicles placed
in service in 2006. No deduction will be allowed after 2006.
Federal
Law allows individuals to claim a deduction for the incremental cost of buying
a motor vehicle that is propelled by a clean-burning fuel. By combining an
electric motor with a gasoline-powered engine, these hybrid vehicles obtain
greater fuel efficiency and produce fewer emissions than similar vehicles
powered solely by conventional gasoline-powered engines.
This one-time
deduction must be taken in the year the vehicle is originally used. The taxpayer
must be the original owner. Individuals do not have to itemize deductions
on their tax return to claim this deduction. This benefit can be taken as
an adjustment to income on the Form 1040.
The amount of the deduction
for the Toyota Highlander Hybrid was set after the manufacturer, Toyota Motor
Sales, U.S.A., Inc. documented for the IRS the incremental cost related to
the vehicle s electric motor and related equipment.
A $2,000 tax deduction? I m off to my local Toyota dealer!
Posted on www.goarticles.com . Richard Chapo is CEO of Business Tax Recovery - Obtaining tax refunds for small businesses for overpaid taxes. Discovery tax strategies and deductions in our tax articles section.
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