Tax the Clunkers: Courtesy of Barack Obama

New ways to tax. Are liberals all so bloody foolish.

Take the 18 mpg cars off the road! Great. Reduce pollution, remove unsafe vehicles, increase gas mileage ... benefits all around.

But what is the benefit for me, who would use this program - I take a car worth $3000 or 3500 and turn it in and MAYBE get $4000 toward a new 28 mpg vehicle. Better for the environment, safer vehicles on the road, reduced oil consumption - more energy independent.

I saw a recent statistic that Americans use of gas dropped 4% in the last few weeks, and further, it had dropped 15% from its high. Aren't we making that change toward greater energy independence? More vehicles that get 25-40 mpg will give us even greater energy independence.

So i trade my vehicle in, it is mine, all mine, and worth $3500. I get $4000 credit toward a new vehicle - presumably one that will cost anywhere from $18,000 to $25,000.

And now ... the credit given to me for MY CAR that I turned over to help the environment and benefit me by giving me a new more energy friendly vehicle - NOW, that credit will be taxed, courtesy of Mr. Obama

UPDATE: Now it has gone caput, clunk, and capowee ... all gone. They shut it down.




CASH FOR CLUNKERS CHAOS

Clunker rebates count as taxable gross income, IRS bulletin says


Donna Harris
Automotive News
July 31, 2009

It turns out dealers will have to pay taxes on the thousands of dollars in rebates they receive under the federal cash-for-clunkers program, according to an IRS advisory bulletin issued today.

The cash-for-clunkers measure, known as the Consumer Assistance to Recycle and Save Act of 2009, exempts consumers who take advantage of the program from paying taxes on the rebate.

But it does not exempt car dealers."Gross income generally means all income from whatever source derived unless specifically excluded by law," wrote Terri Harris, who heads an IRS division specializing in automotive issues. "Gross income derived from a business means the total sales, less the cost of goods sold.

"It likely will be treated like a cash downpayment from the consumer. A NHTSA official assured car dealers listening in on a National Automobile Dealers Association webinar Monday that they would not be taxed on the rebates.

"What you are dealing with are people who don't understand accounting," explains Dick Heider, a Denver-based dealer accountant. "This is a normal payment like in any car deal whether the money comes from the bank, the manufacturer or the government."

Asked why dealers might have been confused about their tax obligations, Heider said they may have thought that because consumers didn't have to pay taxes on the rebate, they also would be exempt.

Says Heider: "It's still money in their pocket."











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