Hey all.. here comes TAX time...<br><br>I know many have posted before, but I am still confused... what kind of tax break will a PRIUS get, how much?.. and for how long?(3 yrs or just the yr you bought it)<br>Any help will be appreciated. Thanks!<br><br>Got my Prius late November 01.<br><br>H.W

If you took delivery after Jan. 1st, Senate bill S.760 could provide substantial tax relief (if it becomes law).<br>If you took delivery in 2001, a $2k tax deduction is probably all that is allowed. However, some members claimed a $2k tax credit last year and to my knowledge none have inidicated that the tax man has come down on them.

After all the discussion regarding this subject, my conclusion is this: the Prius qualifies for a 10% deduction, up to $2,000, off your income taxes for the year 2001. The deduction is a one time shot... does not apply yearly.

I spent a long, long time on the phone with an IRS representative regarding tax deductability. He concluded that since the Prius is not an alternative fuel vehicle, it does not qualify for the deduction.

Form 8834 (Qualified Electric Vehicle Credit) states that hybrid vehicles are not allowed the tax credit for Electric vehicles. However, hybrids may qualify for a deduction for clean-fuel vehicles. Read Pub. 535, Business Expenses, for information regarding clean-fuel vehicles. (Even if we do not use the vehicle for business purposes, we are allowed to use this form.) <br><br>As for receiving the tax deduction beyond the year of purchase, I have not read anything on that matter.<br><br>Good luck with taxes.<br>Keri

Thanks, Keri. The IRS told me that gasoline was not considered "clean fuel" and therefore did not qualify even though the Prius is a hybrid.

Yes, gasoline is not a clean fuel.<br><br>However, the following paragraph mentions that vehicles with extra low emmissions also qualify for the clean fuels deduction, even if they are not using an alternate fuel.<br><br>Taking the electric "credit" is risky, taking the clean fuels "deduction" is O.K. and is even mentioned by Toyota as applying to the Prius. See the Yahoo Prius Group for more info.<br><br>JT<br>Not a tax attorney, or tax professional, just going to take the deduction based on reading the actual forms

This was discussed extensively on these pages last year. It was agreed that the clean fuel deduction is the appropriate one to take. I took it last year after having IRS confirm that it was appropriate.

Thanks to all who replied. Your opinions are all greatly appreciated. I think I have it clear now...<br>Prius is able to get a clean fuel of $2k deduction for the year of purchase only.<br><br>many thanks again<br><br>H.W