Of course everybody would agree that the end user should get the credit. But as I will point out in the following, none of the trial participants is a end user. Let me explain: According to Division B, Title I, Subtitle B, Part V of ARRA (American Recovery and Reinvestment Act of 2009), which amends Section 1141 of the IRC, the term "new qualified plug-in electricdrive motor vehicle’ means a motor vehicle, inter alia, 'which is acquired for use or lease by the taxpayer and not for resale'. Since none of the Mini E lessees is acquiring the vehicle, or using it essentially over the useful life of the vehicle, these tax payers can not claim the tax credit. BMW could claim the tax credit. If they choose not to do so, there is no mechanism to transfer the tax credit over to the lessee. Therefore, even when BMW wanted to transfer the tax credit, there is actually no way to do so.
Please, don't wait for some IRS forms to come out. All these forms will do is mirror the actual legislation, which is shown above. Do not expect to be able to claim the tax credit. Congress has not intended you to claim the tax credit for a mere 1 year lease.

 

kmhjet24,
Well said, while I would love to the full tax credit, $7500 off of $10200 is asking for too much on a one year lease. What BMW should do is take the credit and reduce the car's value on the lease contract by that amount. If they dont want to take the tax credit, they should still reduce the vehicle's value by that amount, as a good faith gesture in the spirit of what this law was for.
While this wouldnt be $7500 back to the consumers it would be a substantial savings and a reasonable compromise. $225 a month is a steal, but $850 a month is robbery.

Robert

 

I wouldn't give up on the tax credit so easily. In my conversations with BMW, the IRS and my account, no one has said that there is no mechanism to transfer over the credit. My account ask me to ask them to sign it over.
I would just like BMW to say that they will do all they can to make this happen from their end. They seem not to care. Also, write your Representatives and ask for this to be cleared up. I have. They all want to do the GREEN thing right now. Especially write the President. He is very hip to Plug-in cars.

 

BMW does not care and neither does the Representative. The law is pretty clear on this, as mentioned. And in the bigger scheme of things, it also does not make sense as the law clearly did not intend the trial participants to benefit from ARRA. So I think it comes down to whether some consider this as being too pricey, while others are willing to afford it. But the tax credit should not play a role in this. If the credit comes the participants' way (which I doubt it will) that's a windfall profit (pure luck).

 

My understanding is the person who leases can take the credit. The useful life argument is still up on the air. Also the AMT rules were changed for this credit so it will no longer be effected by the credit, so you can go under your AMT. (Disclaimer: This is my understanding so it could be wrong)

 

I would advise reading the ARRA as referenced in one of my earlier posts. There's no need to do guesswork, when there is a law passed by Congress. I have quoted the relevant portions in that pervious post.

 

Well the new 8834 form was published. Some unexpected changes (from my perspective anyways):

ONLY the lessor is entitled to the credit, not the lessee. Good for MINI, not as good for us. This is a change from the original 'end-user' wording.

There is no recapture relating to the length of lease. This is logical as the lessee is not entitled to the credit. In addition MINI may sell the cars outright and still retain the credit. This is still a credit earned by putting a new car into service during the tax year.

There is recapture owed if the cars become nonqualifying within 3 years. This would be incentive for MINI to keep the cars in service for that period of time rather than retrofit them with a nonqualifying drive system or (heaven forbid) crush them EV-1 style.

Although this is not oon the form, there are other publications on the IRS site that state MINI must apply for certification of the MINI E as a qualifying vehicle, I believe by the end of calendar 2009.

This is my layman interpretation- you can check it out yourself on the IRS site:

http://www.irs.gov/pub/irs-pdf/f8834.pdf

But the upshot is that we were giving each other good advice when we said 'Don't count on the credit!'

- Scott

 

This is unfortunate [well, it sucks]. I guess we didn't have a big enough lobby on K Street.

But, yes, if you don't expect much, you won't be real disappointed. I never expected it, just hoped.

I did get 2 "free months" because of no working 240v charger... but hardly free, as I could barely use the car—the 110v charger would rarely work without the GFI-to-GFI conflicts and shutdown, and so I could go a week before getting 100% charge. And with a 87-mile commute and, at best (so far), a 94-mile range, any lesser battery charge did me no good on weekdays.

Oh well. Thanks for following up; I've been too busy hanging on to a job.

 

This is big news Scott.

The government is not supporting leases as a consumer incentive. So the person who has the power to put the car on the road should buy if they want to lower their cost.

I will not lease.

OEMs and consumers should all know now that leases mean NO INCENTIVES. This is important for the marketing of the BEVs that are coming out real soon.

If OEMs start claiming tax incentives for leasing plugins I fear it will demonize plugin transactions in the eyes of the public. Big auto getting more government hands-outs, more corporate welfare. Not good.

I will speak up and write my Reps, automakers and journalist once again.

I don't think MINI will keep these cars on the road. They have made it clear to me that they are not claiming the incentive.

Tim, you are in the same boat as many in the program who have returned their cars. With an 87 mile commute you should have never have been considered for the program. One of the MINI mistakes.