How to Maximize Your Tax IRS Gas Mileage Credits

Posted: 07 Jul 2008 | Categories: Taxes

Introduction

With the price of gas rocketing up with no let up, it comes as a relief to realize that substantial tax IRS gas mileage credits are available and this article aims to introduce you to the tax benefits, that you as a motorist may be unaware of and so end up not claiming tax credits that are due to you.

Business Gas Tax IRS Mileage Credits

If you own a small business with four or fewer vehicles you can apply standard tax IRS gas mileage deduction for any mileage incurred in normal business travel. In addition, individuals who travel by car on business, can deduct their mileage on their annual tax return. The tax IRS gas mileage reimbursement should always be claimed, and this can save a reasonable amount of money on your tax bill . However, you do have to keep mileage records to facilitate the IRS tax preparation.

Hybrid Electric Vehicles

If you purchase a fuel-saving hybrid can claim thousands of dollars in federal tax IRS gas mileage credits. The full amount of allowable credits can be claimed until the manufacturer sells 60,000 qualifying vehicles. After which the tax credits are phased out over the ensuing three quarterly periods. FIRSt 50% then 25% and then finally 0%. If you are purchasing a new hybrid vehicle you need to check the number of models sold to determine whether or not you will benefit from any tax IRS gas mileage credits. In addition, Hybrid electric vehicle (HEV) owners are eligible for significant tax incentives from many states as well as just discussed the federal government.

Hydrogen Fuel Cell Vehicles

It should be noted that hydrogen fuel cell vehicles work by combining hydrogen stored in the vehicle with oxygen from the atmosphere to generate electricity. As such, before you purchase a hydrogen fuel cell vehicle, you should ensure the availability of a suitable hydrogen source. For vehicles that are solely electric powered such as the Honda FCX, meet the requirements of the Alternative Motor Vehicle Credit, which stood at 12,000 dollars for 2005 and 2006. It can be seen that fuel cell powered cars attract fairly sizable tax credits.

Alternative Fuel Vehicles

The Alternative Fuel Vehicle (AFV)s allows for a tax IRS gas mileage credit of up to 4,000 dollars. The alternative fuels are compressed natural gas (CNG) , liquefied natural gas (LNG), liquid petroleum gas (LPG), Hydrogen, any liquid at leats 85% methanol by volume or any biodiesel mixture of 20% or more. Vehicles can easily be adapted to run on say liquid petroleum gas. To obtain the tax IRS gas mileage credits available for a conversion please consult an IRS tax representative and/or official IRS publications gas.

Hydrogen Conversion Kits

There is a great deal of interest in modification kits that allow hydrogen to be burned as a fuel. The advantage of these kits is that unlike the other tax IRS gas mileage credits applicable to alternative vehicle fuel schemes we have described in this article, are these kits are within the financial reach of most drivers. The United Nuclear Hydrogen Fuel System Kit is a conversion that provides hydrogen for cars, enabling an existing vehicle to run on hydrogen. The kit is an intermediate approach which when installed allows your existing vehicle to run on hydrogen or gasoline. The kit conversion requires modifications to the engine management, electrics, ignition and cooling systems.

The hydrogen is stored in small tanks (Hydride tanks) which can be installed in virtually any free space within a vehicle. The hydrogen itself is generated by an additional system which can be installed in your garage eliminating any trip to a specialist filling station providing hydrogen for cars. One particular draw back of this particular hydrogen for cars solution is that hydrogen gas burns a lot faster than gasoline and therefore engines with compression ratios greater than 9.5 to 1 will most likely suffer damaging pre-detonation (engine knocking).

If you have a diesel or a car with a high compression ration you can still be available for the Alternative Fuels Motor Vehicle tax IRS gas mileage credit by modifying your car using a brown gas modification kit. This kit simply adds a water electrolysis system to your car which converts water into Oxy Hydrogen or brown gas which when fed into your car engine results in fuel economies of between 30 - 300 percent and coupled with tax IRS gas mileage credits of up to 4000 dollars makes very good financial sense.

Summary

Just to recap, you may be eligible for tax IRS gas mileage credits if your business has four or less vehicles. In addition, if you do any business mileage in your own car you can also claim a tax rebate. Hydrogen fuel cell cars attract substantial tax credits as do alternative fuel conversion kits.Tax IRS as mileage credits for electric hybrids is, however, dependent on the numbers of that particular model sold by the manufacturer.

Bill Williams is a freelance author and software engineer and writes on a variety of topics including how your standard car gasoline or diesel can be modified so that you can benefit from tax gas irs mileage credits benefits of up to 4000 dollars and gas mileage savings of 50%-300%. For more details just visit hydrogen for cars and trucks

Article Author :Bill_Williams

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