Huge $6000 Colorado State Tax Credit for Volt

[DonC]

There were similar issues with credits for EVs in California where the program ended before orders were fulfilled and were out of luck getting their credit.

Not exactly. The funds for 2010-2011 ran out so if your car arrived after that funding ran out, which was sometime in the second half of June, you had to apply for a rebate funded by 2011-2012 appropriations. Those will happen BUT the rebates will be $2500 rather than $5000 since they're decided that it's better to spread the rebates over twice as many cars. Of interest here is that the Volt will be eligible for a $1250 rebate. It wasn't eligible for the $5000 rebated (sob).

Your point about "timing being everything" is valid but it's more like "timing being a big deal" since you lost half the rebate not the whole rebate.

[Zod]

Thanks for the link and info, gieso! I live in Colorado and never thought I could afford one, but maybe now I can reconsider. I see the link you sent says:

"Credits generated in 2010 or 2011 that exceed the tax due for that year are not carried forward but are refundable."

I know little about tax law, but does that mean I can get money back beyond 0 taxes? For example, say I owe & paid $1000 in state taxes, would they actually send me a "refund" check for $6000? This is an important question for me, since I don't make the $150,000+ required to have over $6000 of state taxes.

[tfford]

For example, say I owe & paid $1000 in state taxes, would they actually send me a "refund" check for $6000?

Assuming it works like the Federal credit, which it probably does, no, you can't get more back than you paid in.

[Zod]

Assuming it works like the Federal credit, which it probably does, no, you can't get more back than you paid in.

That would be unfortunate, since it would preferentially benefit those who arguably need it the least (> $150,000/year income) while the net cost to the state government is the same either way ($6000 * number of cars sold under program).

[DonC]

Duh, thanks. You're right.

Not really precise thinking. The CA rebates aren't funded by any tax. They're funded by fines on vehicles found violating pollution laws. Also note that the rebates aren't tied to your state taxes. You get a check even if your income tax bill for the year is zero.

As an observation, having lived in many states, including several that have no income tax, what I've found is that you end up paying about the same amount of tax. For example, not having an income tax in Texas was great ... until I saw the property tax bill which made me almost faint. Not saying there isn't a difference, just that the difference isn't as great as you might think.

[tfford]

You get a check even if your income tax bill for the year is zero.

Are you SURE?

IRS Form 8936 (Qualified Plug-in Electric Drive Motor Vehicle Credit) line 14 requires you to list the smaller of line 10 or line 13 which will be the tax credit amount. Line 10 is the presumed tax credit on the car, line 13 is your tax liability after personal credits. So if your tax liability is smaller than the Volt tax credit, you only get that amount as a tax reduction.

I've no idea how the state tax credits will work but I would be very surprised if they give you a credit (and a check), when you didn't pay any tax.

[rhellie]

The DC Metro and suburbs will be served well if VA and MD offers that kind of credit. Hopefully the states can afford it. I think PA here will not do such a credit since they have budget issues now (including the state capital Harrisburg possibly going into bankruptcy as a city).

Maryland offers a $2000 sales tax credit for purchasing a Volt. I was pleasantly surprised that it was processed at the time I purchased my Volt, lowering my sales tax to under $600.

[DonC]

Are you SURE?

IRS Form 8936 (Qualified Plug-in Electric Drive Motor Vehicle Credit) line 14 requires you to list the smaller of line 10 or line 13 which will be the tax credit amount. Line 10 is the presumed tax credit on the car, line 13 is your tax liability after personal credits. So if your tax liability is smaller than the Volt tax credit, you only get that amount as a tax reduction.

I've no idea how the state tax credits will work but I would be very surprised if they give you a credit (and a check), when you didn't pay any tax.

We're talking about the ARB (Air Resource Board) rebate, not the federal tax credit. The ARB rebates are based on the vehicle and aren't in any way tied to taxes. You can read about it here: https://energycenter.org/index.php/i...ect/about-cvrp

[tfford]

I've no idea how the state tax credits will work

As I said, but,

We're talking about the ARB (Air Resource Board) rebate, not the federal tax credit. The ARB rebates are based on the vehicle and aren't in any way tied to taxes. You can read about it here: https://energycenter.org/index.php/i...ect/about-cvrp

What does California have to to with Colorado? Applicant requirements are; Individuals, businesses, nonprofits or government entities based in California or that have a California based affiliate.

I can't see in the link that you provided or even a Google search on "Air Resource Board", that Colorado falls under this and this whole thread is about a Colorado state tax credit, and I would still be willing to bet that it will operate similarly to the Federal credit but I will still also admit that from a state tax credit, I don't actually know. The Federal credit, I do.

[gieso]

I know little about tax law, but does that mean I can get money back beyond 0 taxes? For example, say I owe & paid $1000 in state taxes, would they actually send me a "refund" check for $6000? This is an important question for me, since I don't make the $150,000+ required to have over $6000 of state taxes.

You only get a credit up to your total tax liability for the year. In your example, you would only get the $1000 credit. I am not sure if I will make it to the full $6000 either, but making my tax payment to the state = $0 sounds pretty good to me.