For tax years 2005 to 2021, taxpayers and businesses have been able to take advantage of a nonrefundable tax credit for purchasing an alternative motor vehicle. The kind of vehicle that qualified for the credit varied over the years:
- Advanced lean burn technology vehicle (2005-2011) - A vehicle with a direct injection internal combustion engine.
- Qualified hybrid vehicle (2005-2011) - A vehicle with an internal combustion or heat engine that uses consumable fuel plus a rechargeable energy storage system.
- Qualified alternative fuel vehicle (2005-2011) - A vehicle fueled by compressed natural gas, liquefied natural gas, liquefied petroleum gas, hydrogen, any liquid that is at least 85 percent methanol, or a mixture of one of these fuels and a petroleum-based fuel.
- Qualified plug-in electric drive motor vehicle (2009-2011) - A vehicle converted to be powered by an electric motor using rechargeable batteries.
- Qualified fuel cell vehicle (2005-2021) - A vehicle powered by one or more cells using energy created by combining oxygen with hydrogen fuel.
Be sure to read the form instructions to ensure the vehicle qualifies for the credit.
If the credit is coming from a partnership or S corp, the business will file Form 8910 and report the credit to the taxpayer partner/shareholder on Schedule K-1, and the taxpayer will report it on their individual return as a general business credit on Form 3800.
To complete Form 8910 in TaxSlayer Pro, from the Main Menu of the tax return (Form 1040) select:
- General Business Credit (3800)
- Current Year General Business Credits
- Form 8910
Recapture of the credit- If any portion of a credit claimed on Form 8910 in a prior year needs to be recaptured, (see Recapture, below), from the main menu of the tax return (Form 1040), select:
- Other Taxes
- Other Additional Taxes
- Recapture of Other Credits
- Recapture of Alternative Motor Vehicle Credit (8910)
Recapture - The Secretary shall, by regulations, provide for recapturing the benefit of any credit allowable under subsection (a) with respect to any property which ceases to be property eligible for such credit (including recapture in the case of a lease period of less than the economic life of a vehicle), except that no benefit shall be recaptured if such property ceases to be eligible for such credit by reason of conversion to a qualified plug-in electric drive motor vehicle.
Note: This article is to provide guidance on entering IRS Form 8910 into the TaxSlayer Pro Program. It is not intended as tax advice.