"For hybrid cars purchased through December 31, 2005, hybrid car buyers are allowed a $2000 income tax deduction, and this deduction was slated to diminish to $500 in 2006.
But thanks to the energy bill signed by the President, hybrid car and hybrid SUV buyers will begin to see even larger tax incentives for new hybrid vehicles purchased beginning January 1, 2006.
The new energy bill allows a $400 to $3400 tax credit depending on model. A credit is much better than a deduction since a tax credit directly reduces taxes owed, as opposed to simply reducing taxable income.
On A Per Automaker Basis, Tax Credit Begins Slow Phase Out Once 60,000 Hybrids Are Sold. The tax credit is set to expire in 2009, but for many hybrid models the incentive will end much sooner."
You can find out for yourself how much of a tax credit you can recieve by clicking on the second link.
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