Wednesday, August 26, 2009

Alternative Motor Vehicle Credit as Nonrefundable Personal Credit Against AMT

For tax years beginning after December 31, 2008, the alternative motor vehicle tax credit is treated as a nonrefundable personal tax credit. This means that, to the extent permitted at the time, you can use it to offset regular tax liability and alternative minimum tax liability. The alternative motor vehicle credit is available for each new qualified fuel cell vehicle, hybrid vehicle, advanced lean burn technology vehicle, and alternative fuel vehicle placed in service by the taxpayer during the tax year. In general, the credit amount varies depending on the type of technology used, the weight class of the vehicle, the amount by which the vehicle exceeds certain fuel economy standards, and,for some vehicles, the estimated lifetime fuel savings. The credit generally is available for vehicles purchased after 2005. The credit terminates after 2009, 2010, or 2014, depending on the type of vehicle, and is subject to phaseout based on the number of vehicles sold by the manufacturer.

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