On March 4, 2008, I purchased a Toyota Prius hybrid car, with a spacious interior, awesome fuel economy (45-50 mpg) at a manageable price (less than $30,000). The decision wasn’t easy, as I was leaving my Ford Expedition (very spacious, fairly expensive, and lousy fuel economy at 13 mpg). Although the large SUV was reliable, dependable, etc. I did not need it for my daily commute.

Funny thing is, I would have never considered this vehicle if I had not been forced to drive it as a rental car on my last trip to California . Thank you National Rental Car! Based upon my average annual driving distance, this car should save me $300 per month on gas, and will help me reduce my carbon footprint (1,000 fewer gallons of gasoline burned each year!)

As a tax person, the first thing I was interested in was whether I could get any tax breaks for purchasing a hybrid vehicle. I had heard that there was a federal tax credit, and also thought that Illinois would have some sort of program to entice me to purchase a car that would help the environment. Wow, was I mistaken. It turns out that the federal credit was all used up for Toyota (limited to only 60,000 cars sold). I could have purchased a Honda or GM car and received a credit, but that did not excite me much.

On the State side, it is amazing to me that there are thousands of exemptions for sales tax on things from pollution control equipment to manufacturing machinery and equipment, but nothing for hybrid cars. Luckily, I did discover that the State Treasurer must believe in helping the environment, because there was a linked-deposit program, whereby the State deposits money with certain banks at below market interest rates, and in exchange, the banks provide a $1,000 rebate for any person that finances a hybrid car in Illinois through the bank. My gift card from CHASE bank should arrive in 6 to 8 weeks.

Useful Links:

Hybrids – Region by Region Local Incentives
http://www.hybridcars.com/local-incentives/region-by-region.html

Hybrids – Federal Credits
http://www.hybridcars.com/federal-incentives.html

Illinois Treasurer’s Office – Hybrid Program
http://www.treasurer.il.gov/programs/cultivate-illinois/green-rewards.aspx