Federal Tax credit of $7,500 for Nissan Leaf - resale?

Another tax credit question.

I noticed a Nissan Leaf of Ebay for $55,000 with 400 miles on it, and was purchased, and now it's being re-sold. I hope it goes for major $.

Question - will the person who purchases the car be able to receive the $7,500 Federal Tax credit, and if they live in Califronia, the $5,000 California credit?

When I asked the seller the question, this was the reply:
"It has been titled in my name, yes. To my personal reading of the law, you may be able to claim the $7500 tax credit, as well as the $5000 california credit (if you are in CA). Other states have credits as well. I will obviously not be claiming the credit, and one may not claim it if one plans on reselling it, so it makes sense that the final buyer may claim it. However, I advise you to consult your tax attorney or accountant to be sure, as I am not a tax professional. This should not be interpreted as tax advice.

I do not have the actual wording of the $7500 tax credit law itself to read, but I suspect that this interptation is incorrect. At least I suspect that the IRS would not go for it.

However, if somebody did try it, they might not get audited and get away with claiming the Tax Credit.

It would be VERY unlikely, however, that they would get the CA $5000 rebate.

http://www.irs.gov/irb/2009-30_IRB/ar07.html

The purchaser may claim a credit with respect to a vehicle if the following requirements are satisfied:

(1) The vehicle is acquired after February 17, 2009, and on or before December 31, 2011;

(2) The original use of the vehicle commences with the taxpayer;

(3) The vehicle is acquired for use or lease by the taxpayer, and not for resale;

(4) The vehicle is used predominantly in the United States.

Click to expand...

Not very well defined, but someone that sell right away can't claim credit because acquired for resale. What will happen after Dec 31, 2011?

The CA rebate requires a copy of your sales contract, and I doubt an eBay receipt would count. Call them and find out.

This guy's tax supposition is self-serving and wrong. As to IRS by my reading, the answer is NO.

IRS form 8834.

note bold:
Qualified Electric Vehicle
A qualified electric vehicle is any motor vehicle if all of the
following apply.
c Manufactured primarily for use on public streets, roads, and
highways, and has at least four wheels.
c Powered primarily by an electric motor drawing current from
rechargeable batteries, fuel cells, or other portable sources of
electrical current.
c Originally used by you.
c Acquired for your own use and not for resale.
Ex ceptions. The qualified electric vehicle credit does not apply
to vehicles that are:
c Used primarily outside the United States,
c Used by a governmental unit or agency or any foreign person
or entity, or
c Used by a tax-exempt organization (other than a section 521
farmers’ cooperative) unless the property is used mainly in an
unrelated trade or business taxed under section 511.

I surmise that it doesnt pencil out for rebate, either.

The seller is wrong. You can not claim either credit on a vehicle that was previously sold and thus is now considered used. He also can't legally sell it as a new vehicle. He is either naive or playing games... Regardless of whether or not it makes sense, it is not allowed.

JimStapleton said:

Another tax credit question.

When I asked the seller the question, this was the reply:
"It has been titled in my name, yes. To my personal reading of the law, you may be able to claim the $7500 tax credit, as well as the $5000 california credit (if you are in CA). Other states have credits as well. I will obviously not be claiming the credit, and one may not claim it if one plans on reselling it, so it makes sense that the final buyer may claim it. However, I advise you to consult your tax attorney or accountant to be sure, as I am not a tax professional. This should not be interpreted as tax advice.

Click to expand...

JimStapleton said:

Another tax credit question.

I noticed a Nissan Leaf of Ebay for $55,000 with 400 miles on it, and was purchased, and now it's being re-sold. I hope it goes for major $.

Question - will the person who purchases the car be able to receive the $7,500 Federal Tax credit, and if they live in Califronia, the $5,000 California credit?

When I asked the seller the question, this was the reply:
"It has been titled in my name, yes. To my personal reading of the law, you may be able to claim the $7500 tax credit, as well as the $5000 california credit (if you are in CA). Other states have credits as well. I will obviously not be claiming the credit, and one may not claim it if one plans on reselling it, so it makes sense that the final buyer may claim it. However, I advise you to consult your tax attorney or accountant to be sure, as I am not a tax professional. This should not be interpreted as tax advice.

Click to expand...

We have an entire thread on the $7500 tax credit already and all the information is on the IRS forms. The answer is simply no and no. Next topic please.

garygid said:

I do not have the actual wording of the $7500 tax credit law itself to read, but I suspect that this interptation is incorrect. At least I suspect that the IRS would not go for it.

However, if somebody did try it, they might not get audited and get away with claiming the Tax Credit.

It would be VERY unlikely, however, that they would get the CA $5000 rebate.

Click to expand...

This, simply put, is tax fraud. The IRS does not look kindly upon it and there are substantial penalties.