What type of tax break is available on hybrid cars?


Quick Answer

In 2015, tax credits for hybrid vehicles range from $2,500 to $7,500, according to the U.S. Department of Energy. Established in 2010, these tax credits phase out as qualified vehicles reach 200,000 sales. After the sales threshold, tax credits reduce by 50 percent and progressively decline each quarter until elimination.

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Full Answer

To be eligible for a tax credit, a vehicle must be hybrid at the point of manufacture and not a conventional vehicle converted to electric, explains the U.S. Department of Energy. The vehicle also must not weigh more than 14,000 pounds and must gain its electricity from a battery with a capacity of at least 4 kilowatt hours. The tax credit is only available to the original buyer of the vehicle.

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