I purchased my Clarity on January 1, 2018 from Unocars Honda here in the desert. (TOTAL LIARS AND SCAMMERS) When I purchased it they had me sign 2 contracts - one dated December 31, 2017 (so they could falsely pad their year end sales inventory) and another dated January 1, 2018 so I could qualify for the $7500 tax credit. I specifically purchased the car 2018 cause I needed the $7500 tax credit for 2018. UNOCARS Honda said the 2017 contract would in no way affect my tax credit. Well...they LIED!! They submitted to the DMV that the car was purchased 12/31/2017. I just had my taxes done and owe $12,000 and my accountant said I cannot use the tax credit because the IRS goes by the year of purchase. I even went to small claims court and the judge ruled in UNOCARS favor because I stupidly signed the 2017 contract. I have the original contract and paperwork that shows I purchased the car on Jan 1, 2018! It was always my understanding that when 2 contracts are signed, the later contract always takes precedent over the first one? So now, I need to find an attorney and take them to court. I hope someone can refer me to a good attorney. Thanks.
Look up the definition of "clean hands" before you consider a lawsuit. A knowing participant in fraud is unlikely to receive help in court (as you've already experienced once).
Looks like no one on here could help when you posted about this before. Maybe use the attorney reference link posted by @bfd above and set up an initial consultation about the problem? You may be advised by an attorney that going the full lawsuit/court route will cost more than it’s worth, with no guarantee of success. Especially with the precedent of the small claims court judge decision. https://www.insideevsforum.com/community/index.php?threads/dealer-screwed-me-over-for-my-2018-7500-tax-credit.4917/#post-52095 I suggest letting Honda of America know about this too. Dealers signing 2 contracts with a customer can’t be in their best interests.
And as a side note, the purchase date is irrelevant when applying for the Federal Tax Credit. There is nowhere on Form 8936 to even report the purchase date. The only date that matters is the date "placed in service". As an example, a vehicle purchased out of state in Dec 2017, put on a truck and delvierd to the buyer in January 2018 would NOT be eligible for a 2017 Tax Credit. If you have in your possession the delivery acceptance paperwork with the walk-around checklist and a 2018 date, that would likely be sufficient proof of placed in service date. I doubt the dealership forged a second set of ALL the paperwork involved in the sale. Even if they did, a credit report should show the date of inquiry/application if it indeed was Jan 1, 2018. And if your check/credit card payment (unless it was a true zero drive off transaction) should also show the Jan 1st date. The only time this information would become necessary is if the IRS decided to audit your return. If you truly did not take deliver until 2018, you are entitled to the Tax Credit in 2018 no matter what the date of the contract.
Can't. I had a lot of tax deductions. I purchased a lot of business equipment for 2017. That's why I specifically purchased the Clarity in 2018.
I already contacted Honda of America. They do not get involved with dealerships because they are all independently owned. I even sent a letter to DMV Investigative department. They said there's nothing they can do. Seems like dealerships can do whatever they want and get away with it.
@DucRider tried to point you in this direction, but you need to consult a tax accountant or tax attorney. If the car was not in your possession and you were not driving it in 2017 (which the 2018 signed document seems to support), then the car was not placed in service in 2017. If it is placed in service in 2018, then you can claim the deduction in 2018 (and only in 2018). In the link below, someone bought an aircraft at the end of the 2003 and was denied ability to claim it in service due to it not yet being modified to meet the owner's needs. Heres a quote: " Evidence presented at trial indicated that the taxpayer had particular needs for the aircraft, including a conference table and enlarged computer screens. Because those modifications were not made until early 2004, the Tax Court agreed with the IRS position that bonus depreciation was allowable only for tax year 2004." Here is the link: https://www.journalofaccountancy.com/issues/2014/apr/placed-in-service-date.html From the instructions for Form 8936 (IRS form for the EV/PHEV credit) The following requirements must be met to qualify for the credit. You are the owner of the vehicle. If the vehicle is leased, only the lessor and not the lessee, is entitled to the credit. You placed the vehicle in service during your tax year. The vehicle is manufactured primarily for use on public streets, roads, and highways. The original use of the vehicle began with you. You acquired the vehicle for use or to lease to others, and not for resale. You use the vehicle primarily in the United States.
Wow!! I think you really hit it with "PLACED IN SERVICE" I did not take possession until Jan 1, 2018. Thank you so much!! I will show this to my accountant. I did download Form 8936 and it specifically states "PLACED IN SERVICE." That makes a lot of sense. What if I preordered a Tesla in Dec and didn't receive it until months later? Makes complete sense. thanks again!
You actually could have bought the car at the beginning of December. If the weather was ICY and you couldn't drive the car until January when you were able to buy and install winter tires, then I think you could still argue it was placed in service in January (or if it was in the shop from the time you paid for it until into January or it was being shipped to you during that time). From what I understand, it is all about when it is available to you for the use it is intended.
As an aside... if your accountant tries to bill you for any additional time or expenses spent working on this particular item, either trying to see if an amendment could be done for 2017 or changing depreciation starting in 2017 to help, I'd kindly tell them I don't think so. They definitely should have picked up on this immediately. Any "tax accountant" or "tax attorney" worth anything would have advised you correctly on this from the start. Claiming the credit in 2017 would probably not stand up in court if it can be proven you took possession in 2018.
x2. This sounds a lot like an accountant causing a problem that does not even exist...I struggle to accept that he or she didn’t catch this. Seems pretty basic.
Yeah - Time for a new accountant. I did print the 8936 form where it states "...placed in service." I will show it to him. I don't think he'll argue with that. Thanks so much. I really appreciate it.
Some accountants are surprisingly clueless about the EV Tax Credit and don't even seem to read the form and instructions. At one of our events, I talked to someone that said they got the tax credit on a used EV. They claimed their accountant had checked with the IRS who looked up the VIN # and since it had never had a Tax Credit filed for it was eligible. He said since the IRS accepted his return and allowed the credit it must be true. I not sure he believed me when I told him if he got audited he would be required to pay back the $7,500 plus penalties and interest (compounded daily). I told him that the IRS does not keep a database of VIN#'s that could be "looked up", and used vehicles did not qualify under any circumstances. Also pointed out that claiming the credit was no different than claiming a $7,500 donation to a charity - it would only be disallowed if an audit discovered it was not valid. The IRS accepting the return and issuing a refund is not validation of any deductions or credits you claim.
Speaking of clueless....I have HOV stickers on my car and I've been stopped twice by cops for being a single driver in the carpool lane. I had to explain what the stickers are for. Of course I was not ticketed and they let me go. Yes. This world is filled with clueless people - accountants and police.
Wishing you the best, and I hope your car-related concerns were resolved satisfactorily over these past four years.
It's been several years since you posted about your car purchase issue. I hope that during this time, you were able to find a resolution to your problem, whether through legal assistance or other means. If you ever come across similar situations or need legal advice in the future, it's always a good idea to consult with an attorney who specializes in the relevant field. Legal matters can be complex, and having professional guidance can make a significant difference. For issues related to the NSA or whistleblower cases, https://federal-lawyer.com/whistleblower-lawyers/nsa/ might be a valuable resource. However, for car-related concerns like the one you mentioned, it's advisable to seek an attorney with expertise in automotive law.
Remember, having a skilled attorney by your side can make a significant difference in resolving this issue. Best of luck in finding the right lawyer, and I hope you achieve a favorable outcome.
It's disheartening when trust is betrayed in such a manner. In your case, seeking legal counsel is undoubtedly the right step forward. When searching for a good car lawyer in the Palm Springs area, it's essential to find someone experienced in contract disputes and consumer protection. They can help you navigate through the complexities of your case and work towards a fair resolution. For assistance in selecting the right attorney, you can refer to this article at https://www.jdsupra.com/legalnews/selecting-a-texas-whistleblower-attorney-5733422/ . Although it's not specific to your location, it offers valuable insights into choosing the right legal representation.
