There are also tax credits available for vehicles that use alternative fuel sources or that are more fuel-efficient. These include:
New qualified fuel cell motor vehicle credit,
New advance lean burn technology motor vehicle credit,
New qualified hybrid motor vehicle credit,
New qualified alternative fuel motor vehicle credit.
In general, in order to qualify for these credits, the taxpayer must be the original user of the vehicle, and the vehicle must be acquired for the taxpayer’s use or lease, and not for resale.
Fuel Cell Vehicles
A base credit of $8,000 can be taken on new qualified fuel cell motor vehicles (hydrogen-powered vehicles) weighing up to 8,500 lbs. Vehicles weighing from 8,500 to 14,000 lbs. are eligible for a $10,000 credit. Larger credits are available for heavier vehicles. For automobiles or light trucks weighing up to 8,500 lbs., there is an additional credit for vehicles that are more fuel-efficient than 2002 models. The amount of the credit increases with the percentage increase in efficiency over the 2002 model year city fuel economy according to a table based on the vehicle inertia weight class. For example, there is an additional $1,000 credit if the vehicle achieves at least 150% but less than 175% of the 2002 fuel economy. This range of additional credits extends up to $4,000 if the vehicle achieves at least 300% of the 2002 fuel economy.
Lean Burn Vehicles
The tax credit for advanced lean burn vehicles is from $400 up to $2,400, according to a table that specifies ranges of percentages by which the fuel economy of the vehicle exceeds the 2002 model year city vehicle fuel economy, as determined by the Environmental Protection Agency.
The aforementioned credit, based on comparatively better fuel economy, is supplemented by a conservation credit of from $250 to $1,000, according to a table based on lifetime fuel savings expressed in terms of gallons of gasoline. For example, to qualify for the maximum conservation credit of $1,000, the vehicle would need to have a lifetime fuel savings of at least 3,000 gallons of gasoline.