Did You Buy A Hybrid or Alternate Fuel Source?

Hybrid and alternative-fuel vehicles are making a positive impact on the environment, but they can also have a positive impact on your wallet. Thanks to the Energy Policy Act of 2005, certain cars purchased in 2006 can earn tax credits of up to $4,000. To be eligible for the Energy Policy Act of 2005, vehicles have to fall into one of four categories: fuel cell, advance lean burn technology, hybrid or alternative fuel. Currently, the only mass-market cars that qualify are hybrids and one alternative-fuel car, the Honda Civic GX. If you purchased your car anytime in 2006, you can claim the credit on your 2006 tax return. For certain cars, the amount you can claim depends on the exact date you bought it, because the Energy Policy Act of 2005 says that when a manufacturer reaches 60,000 sales of eligible vehicles, the credits will begin to be phased out. For example, after an automaker hits the 60,000 mark, the IRS phases out the credits in 50, 25 and zero percent steps over the course of a year. So far, Toyota is the only automaker to have reached the mark. Patrick Olsen, Managing Editor of Cars.com clearly outlines the details of the Energy Policy Act of 2005 and how it can save you money. For more information visit: http://www.cars.com www.cars.com More About Patrick Olsen: Prior to joining cars.com, Olsen was the Page One editor of the Chicago Tribune, managing editor of the Tribune’s RedEye and also worked at the LA Times.