The Internal Revenue Service has released a fact sheet explaining the 2006 alternative motor vehicle credit allowed for 44 automobiles certified as eligible.

The credit, enacted under the Energy Policy Act of 2005, provides up to $3,150 for taxpayers who purchased qualified vehicles and placed them in service during 2006.

With the notable exceptions of Toyota and Lexus model hybrids, which have already sold more than 60,000 units (the limit for the full credit), all qualified vehicles are eligible for the full credit allowed on the model, which is determined by the vehicle’s fuel efficiency. Some credit can still be claimed for Toyota and Lexus vehicles purchased through Sept. 30, 2007.

Credits are available only to the original purchasers of a new vehicle.

The fact sheet also said that:

  • The credit cannot be used to offset the alternative minimum tax for individuals;
  • The credit is limited to the amount of the taxpayer's regular tax liability, is not refundable, and cannot be carried forward or back to an earlier taxable year; and,
  • Businesses that depreciate a qualified vehicle are subject to the rules for the general business tax credit.

The fact sheet is available online, at,,id=165649,00.html.

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