Author Topic: Tax Credit Sunset  (Read 3657 times)

Homer Jay

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Tax Credit Sunset
« on: March 05, 2011, 02:52:27 AM »
While I was having my return completed with my accountant, I inquired about the federal tax credit for purchasing a new electric motorcycle.  He was not readily familiar with the incentive, but had a large book, in which he confirmed the 10% tax credit.  Interestingly there was no provision for the tax credit past the year 2011.  Is this what you folks understand?

Brammofan

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Re: Tax Credit Sunset
« Reply #1 on: March 05, 2011, 07:16:51 AM »
I think it expires in December 2011, but I'm hopeful it will be extended.
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Harlan

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Re: Tax Credit Sunset
« Reply #2 on: March 05, 2011, 06:36:55 PM »
There is no guarantee that the federal tax incentives will be extended.  Additionally, the $1500 California Rebate has limited funding and with the introduction of the Nissan Leaf there is no guarantee that it will be around at the end of the year either. 
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Gavin

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Re: Tax Credit Sunset
« Reply #3 on: December 17, 2011, 07:52:06 PM »
Hollywood Electrics says this in an ad:


With the 10% Federal Tax credit set to expire on December 31 2011, this may be your last opportunity to take advantage of government incentives on an eligible 2011 Zero Motorcycles model.


Is the rebate going away?

Gavin

Phantom

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Re: Tax Credit Sunset
« Reply #4 on: December 17, 2011, 08:17:44 PM »


Technically, the current provision will expire, but I think it will be extended when the new tax laws are due.

This part applies to us:

Plug-In Electric Vehicle Credit (Section 1142): The new law also creates a special tax credit for two types of plug-in vehicles — certain low-speed electric vehicles and two- or three-wheeled vehicles. The amount of the credit is 10 percent of the cost of the vehicle, up to a maximum credit of $2,500 for purchases made after Feb. 17, 2009, and before Jan. 1, 2012. To qualify, a vehicle must be either a low speed vehicle propelled by an electric motor that draws electricity from a battery with a capacity of 4 kilowatt hours or more or be a two- or three-wheeled vehicle propelled by an electric motor that draws electricity from a battery with the capacity of 2.5 kilowatt hours. A taxpayer may not claim this credit if the plug-in electric drive vehicle credit is allowable.

Source: http://www.irs.gov/newsroom/article/0,,id=206871,00.html

Richard230

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Re: Tax Credit Sunset
« Reply #5 on: February 13, 2012, 06:10:37 PM »
Well, at least CA has some money left in their Sustainable Energy program. I mailed off my application today. They told me that they were setting aside $900 for my Zero purchase.  (The 2012 Zero S and DS were approved for the rebate last Friday, according the message that I received.)  No telling how long the money will hold out though, what with a couple of new Tesla and Leaf models on the market, plus other auto manufacturers are jumping into the game.  Electric vehicles should sell better in California than in any other state, is my guess.
current bikes: 2014 14.2 kWh Zero S, 2011 Royal Enfield Bullet 500 Classic, 2009 BMW F650GS, 2007 BMW R1200R, 2005 Triumph T-100 Bonneville, 2002 Yamaha FZ1 and a 1978 Honda Kick 'N Go Senior.

Richard230

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Re: Tax Credit Sunset
« Reply #6 on: February 15, 2012, 11:12:15 AM »
Here is something that you should be aware of if you are applying for a California energy rebate for your EV:  When I read the "fine print" on my rebate form I noticed that you are signing a contract verifying that you agree not to sell your EV for a period of 3 years.  If you do, you may have to return the rebate.  The rebaters will be watching your DMV vehicle ownership records each year to make sure that you still own the bike/car during that period.  So when you buy a Zero or Brammo, you are stuck with the bike for three years - while the latest, improved and exciting new models come out every year.  Something more to think about.

Regarding the Federal Tax Credit, according to my accountant, it is gone and it will be up to Congress to reinstate it for this year.  If I were you, I wouldn't hold my breath for that to happen.   ::)
current bikes: 2014 14.2 kWh Zero S, 2011 Royal Enfield Bullet 500 Classic, 2009 BMW F650GS, 2007 BMW R1200R, 2005 Triumph T-100 Bonneville, 2002 Yamaha FZ1 and a 1978 Honda Kick 'N Go Senior.

Brammofan

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Re: Tax Credit Sunset
« Reply #7 on: February 15, 2012, 05:14:03 PM »
That three-year commitment is something new to me.  I guess that could be a problem with some folks.  :-\
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protomech

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Re: Tax Credit Sunset
« Reply #8 on: February 16, 2012, 03:50:25 PM »
Pres. Obama's FY 2013 budget proposal reportedly increases the EV car subsidy from $7500 to $10000.

Pres. Obama's FY 2012 budget proposal (PDF, p.75) would have changed the tax credit (subsidy applied as part of a tax return) to a tax rebate (applied at time of purchase), but as far as I know this change never made it into the final budget.

Quote
Helps Put One Million Advanced Technology Vehicles on the Road by 2015. To reach this goal and become the first in the world to do so, the Budget proposes new efforts to support electric vehicle manufacturing and adoption in the United States. The Budget transforms the existing $7,500 tax credit for electric vehicles into a rebate that will be available to all consumers immediately at the point of sale, and advances innovative technologies through new R&D investments, building on the Recovery Act investments. In addition, the Budget proposes an investment of $588 million for vehicle technologies—an increase of 88 percent above current funding levels, including a new effort to reward communities that invest in electric vehicles and infrastructure and remove regulatory barriers through a $200 million grant program, modeled after the Race to the Top program.

The budget has to make it through Congress, and we'll have to see what this means for two-wheeled vehicles - FY2011 subsidized two-wheeled vehicles through a separate 10% of purchase price subsidy. I wonder if this is what Brammo is dragging their heels on announcing final specifications and pricing over.
« Last Edit: February 16, 2012, 04:24:53 PM by protomech »
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Mr.Rodgers

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Re: Tax Credit Sunset
« Reply #9 on: February 16, 2012, 04:24:45 PM »
An immediate, POP rebate would be, quite literally, money!
(somewhat)Patiently waiting

Phantom

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Re: Tax Credit Sunset
« Reply #10 on: February 16, 2012, 04:36:17 PM »
Nice find.

The budget has to make it through Congress, and we'll have to see what this means for two-wheeled vehicles - FY2011 subsidized two-wheeled vehicles through a separate 10% of purchase price subsidy. I wonder if this is what Brammo is dragging their heels on announcing final specifications and pricing over.

Yes, I think this is certainly a factor to consider before announcing a price to the consumer.

Richard230

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Re: Tax Credit Sunset
« Reply #11 on: February 16, 2012, 06:03:54 PM »
He is going to have a tough time getting that past the Republicans in the House.   ::)
current bikes: 2014 14.2 kWh Zero S, 2011 Royal Enfield Bullet 500 Classic, 2009 BMW F650GS, 2007 BMW R1200R, 2005 Triumph T-100 Bonneville, 2002 Yamaha FZ1 and a 1978 Honda Kick 'N Go Senior.

860

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Re: Tax Credit Sunset
« Reply #12 on: February 28, 2012, 09:09:40 PM »
...

Regarding the Federal Tax Credit, according to my accountant, it is gone and it will be up to Congress to reinstate it for this year.  If I were you, I wouldn't hold my breath for that to happen.   ::)


The Federal Tax Credit extension was reportedly included in the original Payroll Tax Cut extension legislation that never got passed at the end of last year.  Instead they voted through the 2 month temporary Payroll Tax Cut extension right around Christmas.  When they finally passed the full year Payroll Tax Cut extension a few weeks ago (H.R.3630.ENR) I looked through it, and I couldn't find an extension of the Federal EV Tax Credit.  They didn't extend wind power tax credits either.  This was supposed to be the bill where the Federal Tax Credit extension was supposed to be passed, and it wasn't.  So unless it gets included in some other legislation, the Federal Tax Credit is completely dead.

http://thomas.loc.gov/cgi-bin/query/D?c112:5:./temp/~c112D3Efmy::


I have very low hopes of this incentive being passed through the Republican House.  Brammo and Zero don't have enough lobbyists to get this pushed through, and until the major motorcycle companies are ready to start building EV's, they aren't going to push for this legislation either.  That leaves just the pro-EV community, and I think they are just fighting as hard as they can to keep the EV car tax incentives going.  I don't see any Congress member prioritizing this tax credit high enough to force it through the House in part of a compromise.  

I don't think we will see a federal EV motorcycle tax credit again until there is a Democratic majority in both the House and Senate.  This is the sort of law that gets passed only when one party has control of the legislative agenda in both houses.
« Last Edit: February 28, 2012, 09:12:20 PM by 1416 »

protomech

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Re: Tax Credit Sunset
« Reply #13 on: February 29, 2012, 09:13:48 AM »
On facebook Brammo posts this:
Quote
Iindeed and we are still working to get the Federal incentive - renewed for 2 wheel EV's.

Personally, I'm of a mixed mind about the incentives - especially weaker ones like the previous 10% motorcycle credit.


1. Inconsistent implementation can stall adoption. Someone considering a 2012 emoto purchase may delay if they expect to see new incentives, particularly if those incentives are not retroactive. Furthermore, future incentives reduce the future residual value of the bikes.

2. I suspect weaker credits like the 10% credit do little to encourage the sale of emotos. I think the population of people that would buy (for example) an Empulse 10.0 at $12600 but not $14000 is quite small.

3. Explicit federal subsidies for emotos (and EVs in general) are ammunition against emoto advocacy. I'd just as soon end the explicit EV subsidies, end the more subtle gas subsidies (including Exxon-type tax loopholes), and introduce a gradually ramping gas tax that covers externalities.


Here's my idea for a new gas tax:
* Gradually introduce the tax to avoid economic shocks and allow people to plan with a known fuel cost.
* The gax tax is on top of crude oil pricing, and is set so that the total market  + tax number is fixed. As crude falls in price, the tax ramps up. As crude increases in price, the tax decreases. Again, this allows people to plan budgets and vehicle purchases with a known fuel cost.
* Tie the tax to a sliding window average of crude and re-evaluate every two years.
* The gas tax pays for environmental cleanup and lost jobs beyond a certain cap (see BP) and for "national defense" actions tied to securing gas resources abroad.
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860

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Re: Tax Credit Sunset
« Reply #14 on: February 29, 2012, 03:39:29 PM »
On facebook Brammo posts this:
Quote
Indeed and we are still working to get the Federal incentive - renewed for 2 wheel EV's.

Personally, I'm of a mixed mind about the incentives - especially weaker ones like the previous 10% motorcycle credit.

...

2. I suspect weaker credits like the 10% credit do little to encourage the sale of emotos. I think the population of people that would buy (for example) an Empulse 10.0 at $12600 but not $14000 is quite small.

...

I agree that the 10% credit on a 14K bike isn't a deal maker or a deal breaker on it's own.  The Colorado EV tax credit on the other hand was the biggest reason I even made a reservation for an Empulse 8.0 purchase.  Here was my original math on the cheaper 8.0 Empulse:

12K   Empulse 8.0 price
-1.2K Federal tax credit
-5K   approx. Colorado tax credit.
-2.5K from selling my old SV650
------------------------
3.3K out of my own pocket (plus taxes and carrying costs until I got my tax credits back).

Now I'm looking at possibly there being no 8.0 model, and no federal tax credit, and the math gets very different:

14K   Empulse 10.0 price
-5K   approx. Colorado tax credit
-2.5K sell my old SV650
--------------------------
6.5K out of my own pocket (plus taxes and carry costs).

That's double what I originally budgeted, and it moves the decision from the complete no-brainer category into the category of something I really need to justify and budget for and delay other purchases I'd been saving for.  It's still a hell of a deal though, even with just the Colorado tax credit.  It's just no longer the same deal as I originally planned, and it could delay my Empulse purchase.


If Brammo is waiting for the tax information in order to release prices, that's cool.  That shouldn't stop them from releasing all kinds of technical information and new pictures while they figure out the prices.