Is the federal tax credit income dependent. Nissan advertises the the federal tax credit amount is a range of Zero To $7,500. Why is it a range? Is it based on your income then? Does this mean that the greater your income the smaller the credit?
Actually it's usually the opposite. Basically you have to owe that much in taxes in the first place to get the full amount back. So if you only have $3000 tax liability, for example, you will only get $3000 back. Those with lower incomes tend to have smaller tax liabilities and therefore can't take the full credit.Smartshot said:Is the federal tax credit income dependent. Nissan advertises the the federal tax credit amount is a range of Zero To $7,500. Why is it a range? Is it based on your income then? Does this mean that the greater your income the smaller the credit?
Smartshot said:Is the federal tax credit income dependent. Nissan advertises the the federal tax credit amount is a range of Zero To $7,500. Why is it a range? Is it based on your income then? Does this mean that the greater your income the smaller the credit?
Yikes. I would definitely give them a call and try to clarify the situation ASAP. The IRS itself says that AMT (and therefore tentative minimum tax) should not affect the credit:harryjpowell said:Letter from the IRS said " We changed the total credits on line 54 of your 1040. Some credits are limited to the difference between your tax before credits and the tentative minimum tax from Form 6251, AMT-individuals. Although you were not liable for this additional tax, your credits were still subject to the limitations."
I've redone my return a number of times and didn't owe any AMT but they reduced my 7500 credit to under 3k
Sounds to me like someone at the IRS didn't get the memo in 2009.Treatment of Alternative Motor Vehicle Credit as a Personal Credit Allowed Against AMT (Section 1144): Starting in 2009, the new law allows the Alternative Motor Vehicle Credit, including the tax credit for purchasing hybrid vehicles, to be applied against the Alternative Minimum Tax. Prior to the new law, the Alternative Motor Vehicle Credit could not be used to offset the AMT. This means the credit could not be taken if a taxpayer owed AMT or was reduced for some taxpayers who did not owe AMT.
harryjpowell said:There are a number of other threads but here's what the IRS did to me. Line 54 was 7500
Letter from the IRS said " We changed the total credits on line 54 of your 1040. Some credits are limited to the difference between your tax before credits and the tentative minimum tax from Form 6251, AMT-individuals. Although you were not liable for this additional tax, your credits were still subject to the limitations."
I've redone my return a number of times and didn't owe any AMT but they reduced my 7500 credit to under 3k
My 2cents
As others have said, it is not supposed to work that way, unless there is something else going on that you are not telling us.harryjpowell said:Line 54 was 7500. Letter from the IRS said " We changed the total credits on line 54 of your 1040. Some credits are limited to the difference between your tax before credits and the tentative minimum tax from Form 6251, AMT-individuals. Although you were not liable for this additional tax, your credits were still subject to the limitations."
harryjpowell said:There are a number of other threads but here's what the IRS did to me. Line 54 was 7500
Letter from the IRS said " We changed the total credits on line 54 of your 1040. Some credits are limited to the difference between your tax before credits and the tentative minimum tax from Form 6251, AMT-individuals. Although you were not liable for this additional tax, your credits were still subject to the limitations."
I've redone my return a number of times and didn't owe any AMT but they reduced my 7500 credit to under 3k
My 2cents
EVDRIVER said:If you did your own taxes you may want to seek professional advice for a second look.
So you guys submitted your tax return with the 7.5K credit, but the IRS actually rejected your return and cut it down to a couple of thousands?tzzhc4 said:I am having the same issue. I don't owe AMT but I was told the EV credit could be shrunk by AMT and the IRS took my 7.5k credit down to a couple thousand. Any professional tax preparers who are familiar with the EV credit who can help?
I am not a professional preparer, but I have the same suggestions as for harryjpowell, that he hasn't responded to:tzzhc4 said:I am having the same issue. I don't owe AMT but I was told the EV credit could be shrunk by AMT and the IRS took my 7.5k credit down to a couple thousand. Any professional tax preparers who are familiar with the EV credit who can help?
planet4ever said:I am not a professional preparer, but I have the same suggestions as for harryjpowell, that he hasn't responded to:
If it isn't any of those things, then fight it.
- Verify that line 46 is at least 7,500. If not, that rather than AMT, is the real reason for the limitation.
- Verify that line 53c is checked and that 8936 has been written in next to the check box. If not, your accountant or his software program has made an error. There are other form numbers that could go there, but none of them are likely to give you as much of a credit as 8936.
- Verify that line 53 (to the right of the check box and the 8936) says 7,500, as does line 15 on form 8936.
- Check that nothing else is being claimed on lines 47 through 53. If anything else is, that may be the reason for the restriction.
Ray
dznit said:Nissan should clarify that the $7,500 is a regressive rebate (if you purchase Leaf outright). You have to be at a certain income level (or greater) to receive the full $7,500. The tax code should be amended so that a person could claim over a three year (or greater) period, so that people with lower incomes (who really want an BEV) will receive the full $7,500.
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