Quote:
Originally Posted by Red Bread
D'oh! If true, that just about erases my interest in the i3. $7,500 of tax incentive at 20% effective tax rate is a paltry $1,500, or less than I'd expect my loyalty to my dealer to net me.
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No, it's a tax credit. You get the entire $7,500 off your federal tax liability provided you paid $7,500 in federal tax the year you purchase it. You don't use $7,500 as deduction, It really is $7,500 in your pocket as long as you would have paid more than $7,500 in federal tax that year. Unless you didn't earn much money, you probably qualify for the entire $7,500.