When you purchase an expensive Porsche, tax credits offered by the Federal Government could help to save you thousands on your income tax bill. A credit is much more valuable than a deduction in providing a money saving Porsche road tax discount because it allows you to actually reduce amount of personal income tax that you owe to the IRS. With a standard deduction, you only get to reduce the amount of your taxable income which does not save you as much money.
Before you claim a credit for your Porsche, you should check with an accountant or tax professional, but if you want to try it on your own—here is a handy guide that will show you how.
What You Will Need
- An Internet Connected Computer
- A Porsche that Meets the Requirements for a Tax Credit
- Good Internet Research Skills
Step 1 - Find a Porsche Tax Credit on the Internet
Before you start it, you need make sure that there is a tax credit available for your Porsche. Tax credits are not always available because Congress only authorizes them in order to stimulate the economy or to help promote the purchase of certain types of vehicles. So, use your favorite search engine to make sure that a Porsche tax credit is available when it's time to file your income taxes.
In the text box of your favorite search engine, enter terms like "Porsche new car tax credits" or "new car tax credits and incentives." Then, click on a few of the more relevant links to find articles and information about any credits or incentives that may be available for a qualified Porsche vehicle purchase.
Step 2 - Check to See If Your Porsche Car Qualifies
In your search for tax credit information, you will quickly discover that most tax credits are not specifically offered for a single make and model vehicle. In most cases, a tax credit is offered for certain types of vehicles or for vehicles purchased within a certain timeframe.
Look for websites that offer information about the types of the vehicle tax credits that are available as well as make and model limitations and other requirements. You may find that while a tax credit is available for a new car purchase, your Porsche may or may not qualify.
Step 3 - Check With the Internal Revenue Service
Visit the Internal Revenue Service website and use the search engine box near the top of the site to find articles and publications that provide information on tax credits for new cars. If credits are available, the site will have valuable information about the make and models of vehicles that qualify for the tax discount as well as requirements for taxpayers that want to claim the credits.
Step 4 - Download the Needed Paperwork
On the upper left-hand side of the IRS website, is an area where you can search for various forms of publications related to all types of tax matters. Enter this area the site and download any forms or worksheets that may be needed to calculate the amount of a tax credit and download them to your computer.
Step 5 - Use the Credit to Reduce Your Tax
Refer to the instructions contained in the downloaded forms of publications and follow them for calculating the amount of a new car tax credit for your Porsche. Then, list the amount of the credit on your income tax return and be sure to deduct it from the amount of tax that you owe.