February 5, 2011

Be Careful About Taking The Electric Vehicle Tax Credit

Do you own a Dodge Durango, Cadillac Escalade, a plug-in electric car or an alternative-fuel vehicle and ? Do you plan to claim the electric vehicle tax credit on your 2010 federal income tax return?  If you answered yes to both questions, you better think twice.

A U.S. treasury inspector general has reported that over 10,000 taxpayers erroneously claimed almost $35 million in tax credits for plug-in and alternative-fuel vehicles in the first six months of 2010. That means almost twenty percent of the total $163 million electric vehicle tax credit were claimed in error.

The Inspector General report identified a few examples of the illegal tax credit claim.  Some tried to claim the $7,500 credit on their Dodge Durango, Hummer H3 and Cadillac Escalade SUV.

Before claiming your electric vehicle tax credit, chech with your tax attorney or accountant to see your vehicle qualifies.

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