[Tptplyr12]

Hello!

I am ready to purchase a new Clarity PHEV, and went into a local dealership. When I was there, the sales person told me that it is not eligible for the Federal tax credit in Minnesota, and showed me a list of states where he said it is eligible. The list of states resembles the list of states that offer additional state incentives. I have checked the IRS site, other sites, emailed Honda directly, and went into other dealerships. What I found/what I understand is...
-since the Clarity PHEV is sold new in all 50 states, it is eligible for the federal tax credit in all 50 states.
-MN does not have state level incentives, but that's okay.
-The IRS directed me to the manufacturer for further details.
-Honda will not give any further clarification. They only direct me to the federal and state websites.
-Of the three dealerships I have gone to, one says it is not available, and the other two say it is.

Does anyone here have any clarification, or can direct me to more specific information? I understand that no one can tell me about my personal eligibility. (I know that I would qualify for the full amount.) I just need to confirm that the FEDERAL tax credit is eligible in Minnesota.

Any help would be greatly appreciated, and I look forward to posting again as a new owner of a Clarity PHEV.

Thanks!

 

[stanigu]

The Salesperson is uninformed. He/she should not be providing tax advice!

The credit is claimed on form 8936. If you look at the form, there is no consideration given to the state of residence (which would be absurd, as it is Federal tax credit, not state).

One caveat: if you're leasing the vehicle, the lessor gets the credit (and should reduce the monthly payment accordingly). If you're purchasing (whether by cash or by financing), you should get the credit.

Also, this is not a refundable credit--in other words, if you do not owe at least $7500 in federal tax (not the refund amount--that's different), you'll lose part of the credit. For most people buying a car like Clarity, this is probably not an issue unless you're on social security income only.