President Obama has approved a scaled back version of the Auto Assistance Ownership amendment in the final economic stimulus package. This amendment provides tax breaks for new vehicle buyers by giving them a federal-income-tax deduction on local sales and excise taxes, but not on the interest on loans, as was originally proposed. It enables taxpayers to buy now and get cash back later on their 2009 tax returns. It is applicable to any new vehicle purchased after Feb 17th 2009 (the date the stimulus bill was signed into law). Here are all the eligibility criteria, based on recent IRS press releases:
The deduction is limited to the state and local sales and excise taxes paid on up to $49,500 of the purchase price of a qualified new foreign or domestic cars, SUV’s, light trucks, motor homes or motorcycles that weigh no more than 8,500 pounds. You can still buy a qualifying vehicle for more than $49,500 (e.g a $70,000 Mercedes), but you will only get a tax deduction up to the specified limit.
The deduction is only available to families making less than $260,000 (or $135,000 for single filers). It is phased out for taxpayers whose modified adjusted gross income is between $125,000 and $135,000 for individual filers and between $250,000 and $260,000 for joint filers.
The new vehicle must be purchased on or after Feb. 17, 2009, and before Jan. 1, 2010, to qualify for the deduction. Purchases before Feb. 17, 2009, are not eligible for this special deduction.
The deduction is available regardless of whether a taxpayer itemizes deductions on their return (Schedule A). The deduction cannot be taken on 2008 tax returns (even if they are amended or filed late). Also, unlike other tax credits in the economic stimulus package this tax break is not an offset to your federal taxes (i.e. a tax credit), it is a deduction against your taxable income.
Take advantage of this tax break today. Stop in to Ray Catena Mercedes Benz of Union for more information or contact us if you are unsure or have any questions regarding this article, please give us a call and we will be more than happy to assist you.
Mercedes Benz has officially gone green with its commercial vehicles, and introduced the Mercedes Benz BlueEfficiency Sprinter Vans! According to Autoblog Green, the vans come with two different engine options, a 2.2-liter four cylinder common rail diesel engine that is available in 95, 129 and 163 hp variants and a 156 hp natural gas fueled four cylinder engine. You can read more about the engine specifics on Autoblog Green.
