Is this true? I heard yesterday if you took advantage

[doc03]

of the cash for clunkers that the $3500 - $4500 will be taxed as income this year. I assume this is another Republican lie to discredit the CARS the program.

[imdjh]

1. so what? you still got a helluva deal

[Winterblues]

7. Not really

Most dealers had, previous to the cash for clunkers deal, cash back incentives, some up to four thousand dollars. They discontinued those cash back offers while the cash for clunker program was in place plus they did not give you anything for your vehicle as they would normally in a trade-in deal. The one's that really made out were the dealers. They got to pocket all the cash back incentives they had been offering previously, and the used parts dealers, who got all those clunkers for free which they can strip for parts.

[Warren Stupidity]

19. Keep looking for that cloud.

The dealers in my area were keeping their incentives in place and adding on the clunker program. Car sales increased by 700,000 units. People went back to work. Trickle up stimulus once again proven to be the best way to jump start an economy.

[Statistical]

20. Incentives are set by the manufacturer not dealer and all of them cut back on rebates.

Why give away more money than is necessary.

[dhpgetsit]

2. I cann't confirm that.

But it seems plausible and even appropriate to me.

[OneTenthofOnePercent]

3. Are you really that surprised the govn't is nickel & diming the taxpayers?

I wouldn't be surprised if it were true or even just a rumor.

[sinkingfeeling]

9. Except it's not true.

[Warren Stupidity]

13. "I wouldn't be surprised if it were true or even just a rumor."

:shrug:

[OneTenthofOnePercent]

17. Taxes screwing people or the GOP spreading misinformation...

Would either situation really surprise you?

[sufrommich]

4. I think it's the car dealerships who have to declare it as income. nt

[rurallib]

5. I heard Stephanie Miller debunk that after some winger called in

to hype this lie.
Check www.cars.gov FAQs. I believe that question is handled there.

[doc03]

10. Thanks, someone always knows the answer on

DU. I also saw another lie debunked while reading the list. I had heard that the entire car had to be crushed and if you still owned one of them you wouldn't be able to get any parts. That's another lie, only the the drive train needs to be destroyed.

[MrsBrady]

6. no

[sinkingfeeling]

8. It's not true as far as federal taxes are concerned. Some states are charging taxes and the

RW is going nuts about it.

http://www.cars.gov/faq
Is the credit subject to being taxed as income to the consumers that participate in the program?

NO. The CARS Act expressly provides that the credit is not income for the consumer.

Do I have to pay State or local sales tax on the amount of the CARS program credit?

MAYBE. The question of whether a consumer must pay State or local sales tax on the amount of the CARS program credit depends on the sales tax law of each State or locality. Consumers should review the law of their respective States or consult a tax advisor to answer this question.

[ProgressiveProfessor]

11. Its been all over the media but its unclear as to by whom

Feds I think not, states maybe. In CA you are getting taxed on the full value of the vehicle, not the discounted purchase price by the DMV.

[doc03]

12. They don't miss many opportunities to

tax you in California do they? I went to NY state for the first time a couple years ago, that place is unreal I am surprised they don't have toll boxes to get out of your driveway.

[Warren Stupidity]

14. How exactly is the 'full value of the vehicle' determined?

Seeing as how the dealers just make that number up?

[Warren Stupidity]

16. google says no

"Which raises the question: Are state and local sales taxes applied before or after the price reduction?

After, according to state tax officials. That would result in additional savings. For example, in Los Angeles, where the sales tax rate is 9.75%, lopping $3,500 off the purchase price of a vehicle would save a qualifying buyer $341.25 in sales tax."
http://latimesblogs.latimes.com/uptospeed/2009/07/clunkers.html

According to the California State Board of Equalization, rebates paid by the National Highway Traffic Safety Administration (NHTSA) to new car dealers under the ?cash for clunkers? program are considered ?sales? to the U.S. government. As a result, California sales tax is inapplicable to sales to the United States or its instrumentalities.
http://www.speedtax.com/blog/2009/07/30/california-provides-sales-tax-guidance-on-cash-for-clunkers/

This is right wing crap for the most part. It isn't income and won't be taxed as such. SOME states may charge sales tax on some basis other than the discounted purchase price, California is not one of them.

[ProgressiveProfessor]

22. The CA DMV registration is based on value

You could sell me a new Ferrari for a $1, but the DMV will charge based on actual value.

[Statistical]

18. "NO. The CARS Act expressly provides that the credit is not income for the consumer."

http://www.cars.gov/faq#category-06

[Statistical]

15. No. Per the CARS offical FAQ

Is the credit subject to being taxed as income to the consumers that participate in the program?
NO. The CARS Act expressly provides that the credit is not income for the consumer.

http://www.cars.gov/faq#category-06

Done and done.

[havocmom]

21. Thank you for link. Seems likely we will all need it in coming days

So nice to be ahead of erroneous RW talking points. ;)