South Carolina Plug-In Hybrid Vehicle Tax Credit
South Carolina taxpayers can take advantage of an income tax credit for buying or leasing a new plug-in hybrid within the state.
Specifically, the credit comes out to $667, plus an additional $111 for vehicles with at least five kilowatt-hours of battery capacity. For each additional kilowatt-hour of battery capacity beyond the first five, you get another $111. The credit maximum is $2,000.
I spoke to the SC Depart of Revenue, and multiple Chrysler dealerships.
For the Federal tax rebates:
Some dealers said it reduces the MSRP on the car by $7500
Some dealers said I can claim it on my taxes at the end of the year, so on a 3 year lease I would effectively reduce my monthly payment by close to $200.
Some said they had no idea what Chrysler meant, and that I would have to purchase the car with cash to qualify
One said it is the same concept as financing a car… buy it and simply take the credit at the end of the year
No one had any idea how to use the SC tax rebate.
Any advice or help would be appreciated on how the credit applies for leases, and especially anyone who has actually done it. I tried searching the other forum threads but didn’t get clear picture to understand.
Also, the Residual was quoted at 41%… that is terrible!.. is that right?
Sounds about right for a Chrysler products that. You do not claim the federal tax credit because you don’t own the vehicle. The finance company does so they claim it. Chances are Chrysler provides an incentive as a method of passing along the rebate to you.
Typically when leasing an electric car the financing company gets the credit and they pass a certain amount onto the buyer via a lease credit/cash, like BoardwalkNJ mentioned. I have not heard of any person whom has leased a car be able to apply for the lease credit themselves.
For the state credit, in Colorado the lease credit is reduced vs. a purchase credit. In the past they had a calculation for a lease credit and one for a purchase credit based on the price paid and the kWh for the battery where for example on a lease you may get $1800 but for a purchase it’d be $3600. They’ve since simplified and changed to $2500 flat for a lease and $5000 flat for a purchase. This is applied as a cap cost reduction typically when you purchase the car by signing a form for the dealer to apply for the rebate in your name. The dealer then charges you $150 for the convenience of not filing for it at tax time. I did not see anything in the SC tax code in my quick look through that reduced the credit on a lease though.
Thanks all for the responses.
Looks like there still isn’t a definite answer.
Another related question then:
Whats the difference between the financing and leasing for the purposes of the tax credit?
In either car the title is held by the company supplying the funds, right?
Thus, the process should be the same for applying the federal tax credit, right?
No, it is not the same. For purchasing, you are the owner and your name is on the title, but if you are financing, there is a lien against it. For leasing, you are not the owner and your name isn’t on the title.
Ok so local Chrysler dealership stated that the rebate will be applied to the lease amount.
In other words,
Sales Price - Incentives - $7500.
I am waiting on numbers from them.
They have a Hybrid at 42k(with current discounts).
If they get the number to $400 I will probably pull the trigger.
Thanks for sharing that. No, I didnt see it before, but the numbers are similar to what I think I will get. Just spoke to dealer and waiting on final confirmation. Promised to have the numbers to me by noon today. Will share my findings.
The best local dealers here in NC Charlotte can do is 580 with zero down.
That includes 7500 federal tax and 1500 Ally incentive.
However I went ahead and got an Odyssey for now.
I have a feeling the deals can be made better but did not have time to pursue.