Take Advantage of the 2009 Scooter Tax Deductions :-)

2009 Scooter Tax Deduction

2009 TAX CREDITS FOR SCOOTERS, MOTORCYCLES, AND RV PURCHASES
The recent stimulus package that was signed into law had a last minute inclusion for motorcycles and recreational vehicles. Cars and light trucks already had dibbs on their dollar share of the stimulus billions, and with the successful lobbying from the AMA, Harley-Davidson, and other industry groups, along with the support of four senators from areas most affected by a struggling motorcycle industry (Bob Casey, D-PA, Christopher Bond, R-MO, Russell Feingold, D-WI, and Herb Kohl, D-WI), motorcycles and RVs quietly squeaked there way into the bill. This is not an industry-saving piece of legislation, as we understand it, but may be a gentle purchase incentive for certain buyers. The cost to include motorcycles and RVs to the stimulus is estimated at around $100 million.

SECTION 1008 OF THE STIMULUS PLAN
Section 1008 in the stimulus bill allows taxpayers purchasing a Motorcycle or RV under $49,500 to deduct state, local, county and federal sales tax paid in 2009 when filing their ‘09 tax returns. It is important to understand that this is a tax deduction and not a tax credit.  A tax deduction reduces income reported and not taxes owed. This will be an “above-the-line deduction”, which means that you can take it regardless of whether you itemize other deductions on your tax return. To be eligible for the tax deduction, a single person’s annual modified adjusted gross income for that tax year cannot exceed $125,000 or $250,000 for a joint return.  The effective date for this deduction, according to the language of the bill itself applies, “to purchases on or after the date of the enactment of this Act in taxable years ending after such date.” We interpret this to mean that for any bike purchased after the date the Act was signed until one year from that date.You may want to check with the dealer on that if you are purchasing close to the beginning or ending date.

WHAT DOES THAT MEAN TO ME?
Let’s say you live in California and were buying The Auto Moto which costs $3,800 and you pay 8.25% sales tax.   The sales tax would come to $313.5 and is deductable from your taxes next year.

Click here to see the Tax Stimulus Bill

As defined by the Federal Government:

What is a Motorcycle?
Motorcycle means a motor vehicle with motive power having a seat or saddle for the use of the rider and designed to travel on not more than three wheels in contact with the ground. Motor-driven cycle means a motorcycle with a motor that produces 5-brake horsepower or less.

Is a Scooter a Motorcycle?
Scooter means a motorcycle that: (1) Has a platform for the operator’s feet or has integrated footrests, and (2) Has a step-through architecture,meaning that the part of the vehicle forward of the operator’s seat and between the legs of an operator seated in the riding position, is lower in height than the operator’s seat.