How to Get a Volkswagen Tax Credit

January 27, 2012

If you wish to take advantage of the Volkswagen tax credit, you need to bear in mind a few guidelines. The 2009 Volkswagen that’s manufactured and sold in the US as the Volkswagen Jetta 2.0 Liter Sedan and the Volkswagen Jetta 2.0 Liter Sportwagen, qualifies for a tax credit of up to $1,300. Since all Volkswagen vehicles don’t qualify for the tax credit, you need to review the tips listed below, before filing your taxes.

Getting a Volkswagen Tax Credit:

  • The tax credit is available only on models that have the Advanced Lean Burn Technology certification. To qualify for this tax credit, taxpayers should have purchased a certified vehicle no later than December 31, 2010.
  • The tax credit applicable for the first 60,000 vehicles sold is $1,300. After the first 60,000 cars are sold, the tax credit amount that can be claimed decreases. If you’ve purchased a certified vehicle and don’t know the tax credit amount available on your purchase, visit the IRS.gov website.
  • There are certain restrictions that are associated with the tax credit. Individuals who are subject to the Federal Alternative Minimum Tax may not be eligible for the tax credit. Moreover, if the vehicle has been purchased for business use, the tax credit amount will be reduced or voided.
  • It’s important to know the tax credit on the Volkswagen Jetta is only applicable to new vehicle purchases. In addition, the car owner has to produce the right documentation, such as proof of purchase, to benefit from the tax credit.
  • Since every state has different laws that govern the use of Advanced Lean Burn Technology vehicles, it’s important to find out if you qualify for state tax incentives if you purchase any such vehicle.
  • When filing your returns you need to ask a tax advisor if you have to make an itemized deduction or not. Since each individual falls into a different tax bracket, find out if you can really take advantage of these tax incentives. Individuals with a gross monthly income above a certain limit may not qualify for income tax credits. If this is the case, consider asking a close friend to purchase the vehicle on your behalf.
  • Sales tax deductions are also available on certain vehicles. Do your research well and make an educated choice when selecting any particular car for purchase.

It’s important to consider buying vehicles that provide better fuel economy. The EPA fuel economy estimates for the Jetta TDI are 29 mpg city driving and 40 mpg highway driving. However in real world conditions, the vehicle performs even better. It’s been known to achieve 38 mpg city driving and 44 mpg highway driving. To find out the exact Volkswagen road tax discount you may be eligible for, research the IRS website. It’s always beneficial to work with a taxation agent when filing your returns, because you will know what amount you can actually claim from the IRS. It’s important to take advantage of these tax incentives when shopping for a new vehicle, as they save you a large sum of money.

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