tax credit on used car

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Joined: Tue Aug 05, 2014 2:25 am

tax credit on used car

Postby extreme » Tue Aug 05, 2014 2:35 am

Hello volt owners and enthusiast
I am new here as I am just looking to purchase a volt.

I have came across more than one 2011 volt online that the seller (new car dealer) is claiming the tax credits for the car were never claimed.
One car has about 10k miles and the other has around 22k miles. How is it possible the credits where never applied for? And is it still possible for a 2nd owner ( me ) to claim the credits? The government web site states that credits do not apply to used cars so I am confused.

Thank you for the help

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Joined: Wed Jun 25, 2014 12:29 am

Re: tax credit on used car

Postby coffee4matt » Thu Aug 07, 2014 5:46 pm

I could understand that the previous owner of certain used Volts never applied for the credit. For example, he/she would have needed to have at least $7,500 of federal TAX LIABILITY - specifically in the year he purchased it - to use the credit. (Meaning taxable INCOME of $50,000 or more, assuming an effective federal tax rate of, say 15%.)

Many people do not pay $7,500 per year in federal taxes. (And I could be wrong about this, but my understanding is the timing matters a lot, the credit could not be carried over to another tax year. Meaning if the original owner bought the Volt in 2011, but did not have any taxable income that same year in 2011, then they are out of luck... even if they DID have a large tax liability in 2010 and/or 2012! This timing restriction sounds unfair, so research the restrictions yourself to be sure, if you are counting on using one yourself!)

I would be VERY skeptical of any claims that the buyer of a USED Volt can get a federal income tax credit on the purchase. It's very possible the IRS can & does track by VIN all cars that've had ever federal income tax credits taken on them. Maybe they even publish that list online, and dealers can therefore discover any cars in their used car inventory that were once eligible for a tax credit but for whatever reason never received one. That wouldn't surprise me too much. Maybe the dealer mistakenly just assumes that if the first buyer doesn't use it, any subsequent owner can? That sounds logical, and if the seller can make the sale without that assertion ever being put in writing, then they may just benefit from the error (assuming that it's NOT true - but I don't really know.)

Once the first buyer bought the new Volt, the economy & environment benefited from that sale - whether or not the buyer subsequently complied with the (significant) restrictions required to get the tax credit. Good tax policy would therefore have no further incentive at that point to prop up resale values, by giving tax subsidies to any subsequent buyers of the car.

If it is indeed a "new car dealer" making this claim to you, maybe it's a NON-Chevrolet dealer who took it on a trade-in? However if an authorized Chevy Dealer sells you a used Volt making this claim, then be sure to get it in writing, and you would definitely have some recourse against them (in small claims court if nowhere else), if it turns out not to be true!!

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Joined: Tue Aug 19, 2014 7:14 pm

Re: tax credit on used car

Postby jessemcc » Tue Aug 19, 2014 7:20 pm

I came across the following used Volt on ... 2208818823

It says in the description that................The State and Federal TAX Credits Have NOT been Claimed on this Car!!

I e-mailed them to ask some questions and here was their reply....
Hi Jesse, The Tax Credits have not been claimed on that particular Volt. It shows as a one owner, however it was a Corporate Fleet Vehicle and Corporate Fleet can not claim the Tax Credits. We can't say for sure what you will qualify for and suggest that you talk to a Tax Accountant or Lawyer to find out. We had a Tax Lawyer that spent many hours researching this question and he bought a Corporate Fleet Volt from us. What other information can I provide you with? Please let me know how I can assist you with the purchase of your New Volt. Thank You and have a great day. Kevin McMahon

When I look at the Car Fax, it shows that it was titled a corporate fleet vehicle.

Since it was titled even though it was a corporate fleet vehicle, does this mean that the tax credit would not be available even it was never claimed?

From what I understand if it was titled, it sounds like it wouldn't be eligible, but I am unsure if there would be an exception if it was a fleet vehicle?

Also, I have heard that one usually needs a Manufacturer's Statement of Origin to get credit.

Can anyone clear this up? I am thoroughly confused!

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Joined: Wed Jun 25, 2014 12:29 am

Re: tax credit on used car

Postby coffee4matt » Thu Sep 18, 2014 9:32 am

If you are serious about buying a used Volt, be safe on this issue - ask the IRS itself BEFORE you buy !! (There must be a forum to do so, but will require google search to find it)

If you find out the answer is "Yes" - ie you CAN claim the tax credit for a vehicle that initially qualified, but was never claimed - please post back here for the benefit of the Volt community.

This would be very neat, and I would then consider only used Volts from corp Fleet trade-ins!! Could buy a late model Volt for the mid-$teens !! (net of tax credit)

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Re: tax credit on used car

Postby ggvolt000 » Wed Jun 15, 2016 9:29 pm

I am new to this forum but I am quite apprehensive about buying fleet car.

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Joined: Thu Apr 09, 2015 6:26 pm

Re: tax credit on used car

Postby leppard3 » Thu Jun 16, 2016 1:36 pm

It is my understanding that the tax credit CAN NOT be claimed on a USED vehicle whether or not the original owner received the credit or not. Here is a cut and paste of the information I found:

" The vehicle is acquired for use or lease by the taxpayer, and not for resale. (The credit is only available to the original purchaser of a new, qualifying vehicle. If a qualifying vehicle is leased to a consumer, the leasing company may claim the credit.)"

To me, you MUST be the original purchaser to claim the tax credit.

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Joined: Mon Oct 24, 2016 4:29 am

Re: tax credit on used car

Postby Namasuke » Mon Oct 24, 2016 4:36 am

Well, I was like a second hand car.

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Joined: Wed Sep 26, 2018 1:48 am

Re: tax credit on used car

Postby JohnWick7 » Wed Sep 26, 2018 2:27 am

It is an ideal place to solve the problem.

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