The Federal Government has encouraged the use of different transportation fuels by allowing tax credits on vehicle purchases. The purchase of a traditional (non-plug-in) hybrid vehicle was eligible for a tax credit of up to $3,400 from 2005 through 2010. Diesels, which are more efficient than gasoline vehicles, were eligible for a similar tax credit, as were alternative-fuel vehicles. All of those credits were discontinued at the end of calendar year 2010. Now, electric vehicles and plug-in hybrid-electric vehicles are the only ones for which a tax credit is available – up to $7,500. To find out more about these tax credits, go to the IRS website, or FuelEconomy.Gov.
| Vehicle Type | Calendar Year in which the Vehicle was Purchased | Maximum Credit Amount | Vehicles Currently Eligible for a Tax Credit | |
|---|---|---|---|---|
| Plug-in Hybrid-Electric Vehicles | 2010 - on* | $7,500 | Image
| 2011 Chevrolet Volt |
| Electric Vehicles | 2009 - on*# | $7,500 | Image
| 2010 Coda Sedan |
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| 2011 Nissan Leaf | |||
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| 2011 Smart For Two | |||
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| 2008-2010 Tesla Roadster | |||
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| 2011 Wheego LiFe | |||
| Hybrids | 2005 - 2010 | $3,400 | Purchases made after December 31, 2010 are not eligible for the tax credit. | |
| Diesels | 2005 - 2010 | $3,400 | ||
| Compressed Natural Gas | 2005 - 2010 | $3,400 | ||
| Liquefied Natural Gas | 2005 - 2010 | $3,400 | ||
| Liquefied Petroleum Gas | 2005 - 2010 | $3,400 | ||
| Hydrogen | 2005 - 2010 | $3,400 | ||
| M85 (85% Methanol) | 2005 - 2010 | $3,400 | ||
Source: U.S. Department of Energy and U.S. Environmental Protection Agency, www.fueleconomy.gov website, June 2011. | ||||