If a taxpayer received the credit in 2015 for their 2015 purchase and then subsequently traded that vehicle in for another new eligible vehicle in 2016 are they entitled to receive the credit again in 2016?
-
-
Yes. The credit for plug-in electric drive motor vehicles is covered by IRC §30D, and it contains no limitation on the number of years a taxpayer may take that credit.
When the credit is taken, however, the vehicle's basis must be reduced by the amount of the credit, so a subsequent sale or trade-in could result in a taxable gain. That's not likely to be the case, but it is possible.
Also, there are a few rare types sales or other dispositions that are "recapture events" triggering the full or partial recapture of the original credit. Most ordinary sales and trade-ins are not recapture events, but it would be wise to read the rules to make sure. You may find them in Regs §1.30D-1.Roland Slugg
"I do what I can." -
More info to consider
Way out of my league (and understanding!) but Code § 30D(f)(5) ??
LINK: -->>> https://www.law.cornell.edu/uscode/text/26/30D
Since this was a [ quick!! ] trade-in instead of a complete disposition, there may be only basis adjustments rattling around for the new vehicle.
Glad this tax return is not mine!
FEComment
Comment