I am amazed at the confusion being created on the internet about the<br>Prius tax credit, especially when the tax instructions are so clear. The<br>form 8834 makes it clear that the Prius does not qualify as an electric<br>vehicle, but refers Pub 535 (see page 44) for hybrid electrics. You can<br>deduct 2000 dollars maximum on line 32 of the Form 1040, for your Prius. <br>That's all there is to it. Form 8834 is not involved.<br><br>Jim Carlisle<br>astrojim@...

If I recall correctly, the credit can be applied only to vehicles where the electric motor is the primary source of power. Now it can be argued that this is the primary source of power in the Prius (this argument can go both ways of course). In fact, I recall seeing some posts about IRS offices suggesting to individuals that they take the credit, saying that the electric motor is the primary power source. I believe there have also been accountants who have suggested that the credit be taken.<br><br>Personally, if the rules stay the same for next year(just ordered the Prius in January), I'll be taking the credit as well since several people have successfully done that.<br><br>--Jeremy

In Message 4489 aquaprius stated:<br>&lt;snip&gt;<br>&gt; You can deduct 2000 dollars maximum on line 32 <br>&gt; of the Form 1040, for your Prius. <br>Line 32?<br>On the U.S. Form 1040? :-)<br><br>On MY 1040, line 32 is under the "Adjusted Gross Income" section and says: "Add lines 23 through 31a".<br><br>Still waiting for the last minute...<br>Bill Powell<br>(Prius: Just Drive It!)

Bill,<br>Just to the right of the "Add lines 23 through 31a" text add "CLEAN FUEL $2000) and if you have a total in lines 23 through 31a then add $2000 to it and put the result on line 32.<br><br>Thats what I did and how turbo tax succesfully filed my return.<br><br>Happy Taxes!<br><br>Alan

This is correct - I read the intstructions on the<br>IRS website yesterday - it says to write right on the<br>dotted line (line 32) and add the 2,000 to the rest of<br>the AGI deductions and put the result in the box.