| The IRS is working its way through various | | | | A tax credit is so much more valuable than a tax |
| automobiles that qualify their owners for tax | | | | deduction it isn't even funny. A tax deduction is an |
| credits. The Saturn model of cars has just been | | | | amount that reduce your adjusted gross income. |
| reviewed with one particular model being | | | | Once all deductions are taken out, you then head |
| approved. | | | | to the tax tables and figure out what you owe. A |
| IRS Approves Saturn Vue Green Line for Tax | | | | tax credit, on the other hand, isn't taken out of |
| Credit | | | | your gross income. Instead, you claim all you |
| Owning a hybrid car was pretty much a financial | | | | deductions, go to the tax tables to figure out |
| windfall from the outset. The cars provided | | | | what you owe and then apply the tax credit to |
| tremendous savings on fuel costs. With gas | | | | that amount. For instance, if you determine from |
| costing a vicious $3.90 a gallon in San Diego, the | | | | the tax tables that you owe $10,000 in taxes for |
| savings are not to be understated. On top of this, | | | | the previous year, you can then reduce this |
| the purchase of these vehicles also provided the | | | | amount by the tax credit. |
| owners with a $2,000 tax deduction, a very nice | | | | In this case, we are talking about the tax credit |
| perk indeed. In 2005, things got even better. | | | | amount issued by the IRS for the Saturn Vue |
| The passage of the Energy Policy Act of 2005 | | | | Green Line. For the 2007 model year, you can |
| was something of a godsend to hybrid vehicle | | | | claim a tax credit of $650. You must purchase |
| manufacturers. Frankly, the CEOs of these | | | | the car new from the manufacture [thus the |
| companies must have dropped to their knees and | | | | weeping CEO]. Moreover, the amount of the |
| openly wept. This moment of humanity had | | | | credit starts falling after the 60,000th vehicle is |
| everything to do with the change of one word in | | | | sold, so you need to go buy one now [more |
| how hybrids were viewed for tax purposes. | | | | weeping and hysterical laughter from the CEO]. |
| Individuals who purchase new hybrids approved | | | | Most people complain about a lack of tax |
| by the IRS no longer where eligible for a tax | | | | deductions when it comes time to file tax returns. |
| deduction. Nope. The word "deduction" had been | | | | Tax deductions are nice, but tax credits are |
| changed to "credit", a massive difference in the | | | | where the real savings occur. |
| world of tax returns. | | | | |