Buying & Leasing a Car

Last Call for Electric-Car Tax Credit?

Congress is considering pulling the plug on a lucrative tax credit for buyers of electric cars and plug-in hybrids.

Time could be running out on the chance for new-car buyers to pocket a tax credit worth up to $7,500 for the purchase of a new electric or plug-in hybrid vehicle.

The tax overhaul plan passed by the House of Representatives includes a provision that would unplug the credit at the end of 2017. The Senate plan does not make that change, but some Senators are pushing for it and electric-car advocates fear it could find its way into the final legislation. Under current law, the tax credits are available until each manufacturer has sold 200,000 qualifying vehicles.

The Electric Vehicle Association of Greater Washington D.C., a non-profit advocacy group that promotes the technology, has a nifty fact sheet that shows over 30 vehicles that currently qualify for the credit. Ron Kaltenbaugh, president of the group, says the “uncertainty over the future of the credit is frustrating for people who have made plans to buy an electric vehicle.”

But Kaltenbaugh warns against letting the potential demise of the credit stampede you into buying a new car by New Year’s Eve. For one thing, he notes that several pure electric vehicles with longer driving ranges will arrive on the market soon. But if you’re planning to buy a hybrid electric/gas vehicle such as the Chevy Volt or Chrysler Pacifica Hybrid, for which a $7,500 credit could cover nearly 20% or even more of the purchase price, you might want to try to beat the deadline.

Again, it’s unclear whether the credit will end at the end of 2017. But, if it does, you’ll need to have your new car registered in your name by the end of the year to claim the credit on your 2017 tax return. Simply ordering it won’t lock in the credit. For more information about the credit, check out this IRS Web page.

Most Popular

Planning to Sell Your Home in Retirement? Downsize Costs Along With Space
Budgeting

Planning to Sell Your Home in Retirement? Downsize Costs Along With Space

In this hot real estate market, consider the costs of buying and selling a house along with the expenses associated with your new digs.
November 13, 2020
What Biden Will Do: 24 Policy Plays to Expect From the Next Administration
Politics

What Biden Will Do: 24 Policy Plays to Expect From the Next Administration

The Kiplinger Letter forecasts President-Elect Joe Biden’s biggest priorities -- and the likelihood of progress on them.
November 19, 2020
The 13 Best Healthcare Stocks to Buy for 2021
Kiplinger's Investing Outlook

The 13 Best Healthcare Stocks to Buy for 2021

Most of the best healthcare stocks for 2021 will have some sort of ties to COVID, whether it's producing a vaccine or cure, or benefiting from the vir…
November 20, 2020

Recommended

19 Best Costco Kirkland Signature Products to Buy for the Holidays
spending

19 Best Costco Kirkland Signature Products to Buy for the Holidays

From Costco Kirkland Signature Nuts and other holiday snacks to Costco Kirkland Signature fruitcakes and gift sets, there are a ton of holiday bargain…
November 24, 2020
Making Wise Choices During Open Enrollment
health insurance

Making Wise Choices During Open Enrollment

Contributing Editor Lisa Gerstner runs through the new variables of the 2020 open enrollment season. Also, hosts Sandy Block and David Muhlbaum talk a…
November 17, 2020
Dear Mom and Dad: Thanks
Making Your Money Last

Dear Mom and Dad: Thanks

Ideally, living at home should provide a way to improve your financial well-being and lay the groundwork for future success.
November 17, 2020
17 People You Should Tip for the Holidays
spending

17 People You Should Tip for the Holidays

The holiday season is prime time to give back. So who gets a holiday tip this year – and how much?
November 6, 2020