How to Save Big with Trump and Biden's Car Tax Credits
Introduction
The debate between President Donald Trump and President Joe Biden is not only limited to their political ideologies, but also extends to their policies on car-buying incentives. Both presidents have introduced tax credits for new car purchases, but how can one take advantage of both of them? In this blog, we will explore the strategies to save thousands by stacking Trump's new-car tax credits with Biden's.
Background
In 2019, President Trump implemented a new-car tax credit to encourage consumers to buy American-made cars. This credit allows buyers to deduct up to $7,500 off their federal taxes. On the other hand, President Biden's recent stimulus plan includes a proposal for a new car tax credit of up to $12,500 for electric or zero-emission vehicles. This makes it the perfect time to purchase a new car and take advantage of both incentives.
Current Scenario
With the new tax credit from President Biden, the maximum deduction has increased to $12,500. This means that if you purchase an electric car for $40,000, you can deduct the entire amount from your federal taxes. However, the credit amount decreases as the price of the car increases. For example, if you purchase an electric car for $60,000, you can only deduct $7,500. This is where Trump's tax credit comes into play.
If you purchase a car that is eligible for both credits, you can stack them together and save even more. For instance, if you buy an electric car for $60,000, you can claim $7,500 from Trump's credit and $5,000 from Biden's credit. This brings your total deduction to $12,500, the maximum amount allowed by the new proposal.
How to Take Advantage
In order to take advantage of both tax credits, it is important to do your research and choose a car that is eligible for both incentives. This could either be an electric or zero-emission car that is also made in America. Additionally, it is important to act fast as the new proposal from President Biden is still in the works and may not be finalized until later this year.
Conclusion
By stacking Trump's new-car tax credit with Biden's, you can save thousands of dollars on your next car purchase. With the increasing popularity of electric cars, this is the perfect opportunity to take advantage of both incentives and make a smart investment. So, start researching and find the perfect car to stack these tax credits and save big on your new car.
