Cash for Clunkers

[tpnl]

I know I have seen the answer to my question, but I cannot find it now.

Will the $3,500 or $4,500 be taxed? I thought I read somewhere "No." I had a client call and ask. I know for business it will be treated differently, but just an individual.

[JohnH]

Not taxable income for Federal purposes, but I understand a few states have their greedy eyes on it.

[DaveO]

The rebate is subject to sales tax in Nebraska.

[ChEAr$]

And for a business, it stands to reason that the 4500 is simply a reduction in sales price,
hence reduced depreciation over time.

[jimmcg]

The rebate is subject to sales tax in Nebraska.

Ditto for Ohio. I doubt that most states will let this rebate amount slip through their greedy sales tax paws.

[Jesse]

Surprisingly.....

Wisconsin has decided not to charge Sales or Use tax on the rebate amount.

For purposes of Wisconsin's sales and use taxes, the amount of the voucher issued by NHTSA is not subject to Wisconsin sales or use taxes. The amount of the voucher that is paid directly to the car dealer from NHTSA, a federal government agency, is not subject to Wisconsin sales or use tax since this part of the sale is considered a sale to the federal government.

[S T]

Clunkers - Income Tax

Here is California and of course they have to make it complicated http://www.ftb.ca.gov/professionals/...rticle_1.shtml

NC - doesn't seem like NCDOR has posted - but this has been publicized in local articles

http://www.digtriad.com/news/local/story.aspx?storyid=129479&catid=57

Some states are collecting sales tax and some States seem to want to collect an income tax

Sandy

[nalawson]

Not subject to sales or use tax in Kansas.