There’s a common misconception among many car buyers that electric and Hybrid cars are expensive and don’t offer the same level of performance as conventional gas and diesel powered cars. The reality is that hybrid cars offer high MPGe, are fuel efficient, and you don’t have to break the bank to own one. This is because governments across the globe are offering incentives to ensure hybrid cars do not suffer the unfortunate fate of electric cars that had so much promise but couldn’t sell due to high prices. This has seen hybrid cars finding space in people’s garages, whether new, pre-owned, or bought at salvage car auctions. There are many who are still unaware of the benefits and finer points of owning a hybrid. To clear the smoke, we highlight notable nuisances related to owning a hybrid car.
The Energy Improvement and Extension Act of 2008 passed by the U.S. Federal government grants tax credits to buyers of new qualified plug-in hybrid vehicles. This gives them a tax Credit of $2,500 to $7,500 on new purchases, depending on the size and capacity of the car’s battery. While cars with a 4 kWh battery qualify for a $2,500 tax credit, the maximum credit of $7,500 is for cars powered by a 16 kWh battery. The tax credits or incentives are phased out once an automaker registers 200,000 vehicle sales.
Plug-In Conversion Kits
The American Recovery and Reinvestment Act of 2009 (ARRA), commonly known as ‘The Stimulus, provides a tax credit for plug-in electric drive conversion kits. The credit is set at $4,000 or 10 percent, whichever is lower, of the cost of converting a vehicle to a qualified plug-in electric vehicle, and this has been in place since February 17, 2009. Cars converted post December 31, 2011 do not qualify for the plug-in conversion kits incentive.
There are several parameters that a car buyer needs to meet to qualify for the tax credit incentives, some of which are detailed below:
- The car should be put into service after 12th December 2005 and bought on or before 12th December 2010.
- Only the original owner of the new hybrid vehicle can claim the tax credit and it does not apply to a used hybrid vehicle.
- The leasing company can claim the credit for a qualified vehicle leased to a consumer.
- If a qualifying vehicle is used by a tax-exempt entity, the seller is eligible to claim the credit, only if they clearly disclose the amount of credit in a document to the tax-exempt entity.
- The vehicle has to be used primarily within the United States of America.
To encourage car buyers to invest in clean energy, several major insurance companies offer discounts for electric and hybrid cars. Farmers Insurance, for instance, offers a discount of 5 percent.
The government also offers incentives on fueling equipment and related infrastructure, such as EV charging points for electricity. They are eligible for a tax credit of 30 percent, maxed at $1,000 for each station for individuals and $30,000 for commercial buyers.
In addition to federal incentives on hybrid vehicles, state incentives are also applicable and vary from state to state. In Texas, for instance, The Texas Commission on Environmental Quality provides incentives for the purchase or lease of eligible new plug-in electric vehicles, capped at $2,500. Even cities have incentive plans, with free metered parking for EVs in San Antonio and rebate of up to $1,500 on purchase of EV charging equipment in Austin.
The Bottom Line
If you want to buy a car and make a contribution towards a clean environment, you should consider buying a hybrid instead of a conventional gas powered ride. While incentives and tax credits applicable on the new cars make them affordable, pre-owned or salvage hybrid car buyers can access even lower prices. If you are searching for a salvage hybrid car, check out GreenSalvage car auction site. We offer pre-owned, salvage, repairable, and crashed cars for sale. To learn more on how you can participate, fill out our contact form or simply dial +1 (503) 446-1741.