Another favorable Clarity review
https://www.google.com/amp/s/www.to...u-will-read-about-important-new-green-car/amp
https://www.google.com/amp/s/www.to...u-will-read-about-important-new-green-car/amp
Torque News Clarity Review
- Thread starter RickSE
- Start date
- Replies 24
- Views 4K
KentuckyKen
Well-Known Member
Wow. That’s the most honest and accurate review I’ve seen so far. If this review gets around enough, sales have got to go up. Makes me feel intelligent for having bought one.
I'm surprised they believe the Clarity is about the same size as a Civic when it's longer than an Accord. It doesn't make sense to compare the "sales" of the 50-state Clarity PHEV to the California/Oregon-only, lease-only, limiited-production Clarity Electric. I wish I'd waited for the $19K Clarity PHEV; I paid double that to get the first one off the truck!
PHEV Newbie
Well-Known Member
I think he meant including all the federal and state incentives coupled with dealer discounts. I bought the first one from my dealer last Dec and paid $27000 for a Touring using his formula. Normally, I would wait a while but I was certain the Republicans would eliminate a green car tax incentive that Democrats like in their tax bill so I bought then. How the heck did that tax incentive survive?
dalbeck
Member
Is it just me or is the representation of the federal tax credit way off? I will be the first to admit when I started shopping for a Volt a month ago and just started exploring the PHEV market I thought, "nice, I will get the Volt for about $38k, put a down payment, and get $7500, plus $1k back from PA return so I will only be paying $29,500 before my money down"..
I really feel like most consumers are also thinking that way, at least from what I have read online and seen on some review videos. My experience at 4 dealerships (3 Chevy and 1 Honda) was that either they had no idea what the tax credit was, they couldn't comment on it and just said to speak to your tax advisor, or they pitched it as an almost $8k rebate on the car.
After doing more reading and understanding online that this $7,500 credit only applies if you actually owe money at the end of the year, and is not, in fact, a free check from the government, it seems most people subtract that from the cost of the vehicle which doesn't seem right at all.
I would love to be corrected on this though not only for my own benefit but for the benefit of others. But how I understand this now, the uninformed consumer might be thinking their Clarity Touring wills start around $30k and not $37k.
I really feel like most consumers are also thinking that way, at least from what I have read online and seen on some review videos. My experience at 4 dealerships (3 Chevy and 1 Honda) was that either they had no idea what the tax credit was, they couldn't comment on it and just said to speak to your tax advisor, or they pitched it as an almost $8k rebate on the car.
After doing more reading and understanding online that this $7,500 credit only applies if you actually owe money at the end of the year, and is not, in fact, a free check from the government, it seems most people subtract that from the cost of the vehicle which doesn't seem right at all.
I would love to be corrected on this though not only for my own benefit but for the benefit of others. But how I understand this now, the uninformed consumer might be thinking their Clarity Touring wills start around $30k and not $37k.
It’s not a free check from the government. It’s a tax credit. If your taxes due are less then $7500 then you get whatever you would have owed back. If more then $7500 then you pay $7500 less then you otherwise would have paid. I think if you earn over $60k then the taxes owed will be around $7500. I’m not a tax accountant so this isn’t advise, but if you paid over $7500 in taxes last year and earned about the same then even with the new tax code the full credit probably could be used.
For those people who paid or will pay with their wage, sure the tax credit equals free money.
The problem can occur if we also consider the age distribution…… Retired people can have little tax liability if they have Roth only (that's poor tax planning BTW)
dalbeck
Member
Right. So, that does confirm what I said, however, I feel dealers and many blog posts online as well as posts within forums do not explain that and do the opposite by almost selling it as a rebate off the vehicle. I can think of 1-2 reviews or videos I have seen where its actually addressed correctly, and the rest make you believe its a rebate towards the cost of the vehicle.
What you owe (or refund) in taxes at the end of the year on your tax return is a misleading leading statement for most people. What you owe/refund on your tax return the the relationship between your Tax Liability (what you owe the IRS) and how much was withheld from your paycheck. If more than your Liability was withheld you get a refund. If not enough, then you owe.
EXAMPLE:
A) If your tax liability (after all deductions) was $11,000 and you had $12,000 withheld from your paycheck you would get a $1000 refund.
B) If your tax liability (after all deductions) was $11,000 and you had $10,000 withheld from your paycheck you would owe $1000.
Now, you purchase a Clarity you are entitled to a $7500 tax credit. In example A) your tax liability is reduced by $7500 to $3500 so you would get a refund of $8500 on your return. Example B) your tax liability is reduced by $7500 to $3500 so you would get a refund of $6500 on your return.
Formula is: Tax Liability minus Withholding minus Tax Credit equals Refund.
HOWEVER - If your Tax Liability is LESS THAN $7500 then you will only get a Tax Credit for whatever the Liability is.
I live in MA also- just wondering where you go the 15.7K number from. Mass gives $2500 rebate plus $7500 fed, did you get $5700 off list?
dalbeck
Member
Thank you JackH for the clarification. This is a prime example of what I mean, and I wish the video reviewers and the authors of these blog reviews would research before presenting the incentives the way they do. Also, toss in the dealers in this. I would rather the dealer just say speak to a tax professional then sell a bag of goods or give out misleading information.
You have to have a tax liability of $7,500. It doesn't matter at the end of the year whether you get a refund or owe money. As long as your income is >$65,000 single or $90,000 married jointly without 401k and 0 kids, you will get the full $7,500. If you earn less, you get whatever your tax liability is.
I got the numbers from using this tax calculator:
http://www.calcxml.com/calculators/federal-income-tax-calculator?skn=#results
If you don't think you will have enough income to get the full amount, there are things you can do to get more tax liability, so consult a tax expert.
<-- Not a tax expert
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We retired people converted regular IRA funds to Roth IRA funds to create the necessary $7,500 tax liability. Now we'll never have to pay taxes on the converted funds and we won't be forced to deal with minimum required distributions at age 70-1/2. (I hope that qualifies as good tax planning.)
dalbeck
Member
I feel like we should take the valuable slightly unrelated tax info that was explained in this thread and make it a sticky post on the forums for new buyers as well as misinformed users.
Just want to say thanks to those above who painted a much better and clearer picture on the subject.
Just want to say thanks to those above who painted a much better and clearer picture on the subject.
Drive green discount - see url attached. I printed the Clarity deals, took it to The Honda Store and they matched it. The offer was only $4700 when I bought my car but it’s higher now.
http://massenergywebservices.com/dr...417f398b|4ceedccc-4f5a-46e5-991f-361c96a75391
MPower
Well-Known Member
If you don't have enough tax liability to take the full $7,500 tax credit, you might consider a lease.
"Though you don’t personally get most tax credits when you lease, the leasing company/lender benefits from the incentives. In many instances, this can positively impact the lease deal. It also gives you some extra bargaining power, since you’re well aware that they’ll be getting a nice kickback from your deal. To top it off, you won’t have to worry about qualifying for the credit or waiting until tax time to benefit from it." https://insideevs.com/5-reasons-lease-next-electric-car/
Just keep this in mind if you are leasing and be sure to dicker about the monthly payments
"Though you don’t personally get most tax credits when you lease, the leasing company/lender benefits from the incentives. In many instances, this can positively impact the lease deal. It also gives you some extra bargaining power, since you’re well aware that they’ll be getting a nice kickback from your deal. To top it off, you won’t have to worry about qualifying for the credit or waiting until tax time to benefit from it." https://insideevs.com/5-reasons-lease-next-electric-car/
Just keep this in mind if you are leasing and be sure to dicker about the monthly payments
That was my first thought as well - this review is going to turn away people based on comparing it to a smaller car! We initially assumed it was a smaller car (I think after looking at rear head room numbers which were important to us) but checked it out after looking into the accord hybrid and found out it was essentially accord sized and way better than the other PHEVs available.
Guess torque news is quite the fan:
https://www.torquenews.com/1083/her...ev-story-you-will-read-tell-us-what-you-think
https://www.torquenews.com/1083/her...ev-story-you-will-read-tell-us-what-you-think