Manufacturers have been offering cash-back incentives on new car purchases for years. Now you can add an Internal Revenue Service benefit to that package.
The IRS announced that state, local and excise taxes on new car purchases made this year can be deducted on the buyer’s 2009 tax returns next year.
“For those thinking about buying a new car, this deduction may give them a little more drive to make their purchase this year,” said IRS commissioner Doug Shulman.
The deduction applies to state and excise taxes paid on up to $49,500 of the purchase price of a qualified new car, light truck, motor home or motorcycle bought from Feb. 16 to Dec. 31, 2009.
Of course, there’s a catch. The amount of the deduction is phased out for taxpayers whose modified adjusted gross income is between $125,000 to $135,000 for individual filers and $250,000 to $260,000 for joint filers.
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About Boston Overdrive
|Clifford Atiyeh is an automotive writer and car enthusiast . He has spent his entire life driving cars he doesn't own.
In the garage: 1995 21-speed Iron Horse, 2002 Jeep Wrangler X (by association)
|Bill Griffith is a veteran Boston Globe reporter, having reviewed cars for more than 10 years and serving as assistant sports editor for 25 years. He was also the paper's sports media columnist.
In the garage: 2006 Subaru Baja
|John Paul is public affairs manager for AAA Southern New England, a certified mechanic, and a Globe columnist. He hosts a weekly radio show on WROL.
In the garage: Hyundai Sante Fe, Chrysler PT Cruiser convertible
|Craig Fitzgerald has been writing about cars, motorcycles, and the automotive industry since 1999. He is the former editor of Hemmings Sports & Exotic Car.
In the garage: 1968 Buick Riviera, 1996 Buick Roadmaster, 1974 Honda CB450
|Keith Griffin is president of the New England Motor Press Association and edits the used car section on About.com. He also writes for the Hartford Business Journal and various weekly newspapers in Connecticut.
In the garage: Mazda 5, Dodge Neon
|George Kennedy is a senior writer for WheelsTV in Acton, which produces video reviews for Yahoo, MSN, and other auto websites.
In the garage: Lifted 1999 Jeep Cherokee