Senate votes to give a tax break to new car buyers

[clayinaustin]

The Senate voted Tuesday to give a tax break to new car buyers, setting aside bipartisan concerns over the size of an economic stimulus bill with a price tag approaching $900 billion. The vote was 71-26 to allow many car buyers to claim an income tax deduction for the cost of automobile sales taxes and interest payments on car loans.

Mikulski's office put the cost of the tax break she sponsored at $11 billion for one year. It would apply to the first $49,500 in the price of a new car purchased between last Nov. 12 and Dec. 31, 2009. Individuals with incomes of up to $125,000 and couples earnings as much as $250,000 could qualify, including those who do not itemize their deductions.

More here --> Senate votes to give a tax break to new car buyers

 

[clayinaustin]

It may be time to buy a new truck!

 

[Expensive Date]

Dec 2 08 I am getting a check:26:

 

[Audiofn]

About time they did something that will actually create jobs and save businesses.

 

[Offshoredrillin]

I'm surprised she had anything to do with it...she has been a disappointment here the whole time since she left the lollipop guild..

 

[Boss252]

Just bought a new car for the wife 2 weeks ago. Sounds good to me

 

[sledge]

Doesn't do anything for those of us that reside in states that can already deduct sales tax on everything.

I'm sure it'll help all the people that have been layed off and can't get loans to run right out and buy a new car. Not to mention those that are about to get layed off; I'm sure this will motivate them to trade in their 3-5yr old car that's upside down.

Pure auto industry pork and bad fiscal policy that does little to help those that actually need it.

 

[clayinaustin]

Doesn't do anything for those of us that reside in states that can already deduct sales tax on everything.

Maybe, but when was the last time you could deduct interest on a car note? 20 years ago?

 

[dwtinc]

Its better then just giving out cash. At least it promotes lending and buying

 

[OldSchool]

Maybe, but when was the last time you could deduct interest on a car note? 20 years ago?

I can't believe than nobody remembered that the car companies are so phucking desperate to sell anyone a car that they will do for 0% interest!!!!!!!!

Wake up people....more smoke and mirrors. Of course, people who have not paid their bills and have a chitty credit score don't get approved for 0% financing. So this whole thing is just one more handout to the people that us taxpayers are now expected to support. Welcome to Hope and Change!!!

:rant::rant::rant:

 

[clayinaustin]

I can't believe than nobody remembered that the car companies are so phucking desperate to sell anyone a car that they will do for 0% interest!!!!!!!!

The last time I bought a new vehicle (my current truck) I had the choice between 0% interest or "cash back". I took the 0% interest because I planned to keep the truck until it was paid for. I "did the math" and I was better in the long run to take the 0% interest.

On my next truck the "math" will now be different because (if the bill passes as is) I can deduct the interest from my taxes. I may be better off taking the "cash back".

Just my two-cents...

 

[sledge]

Clay, you're a perfect example of why this is ignorant fiscal policy. A 6-figure earner with plenty of disposable income. Let's say you buy that $50k auto @ 7% and use the defacto standard 35% tax bracket. Does that $1000 savings in the first year make or break you? And consider where that $1k is coming from: Saudi Arabia, China, Russia are a few of the US' largest creditors. Or if we just print it, the money will come out of our kids' pockets in the long run. The most ignorant part is, once again, the people that need help don't buy $50k cars and they're not in a 35% tax bracket which means this tax break is worthless to them. On the plus side, since most people won't save much, it actually won't cost nearly as much as the estimates propose.

I'd rather we all continue to be stimulated by pics of Claymates.
:cheers2:

 

[Expensive Date]

Clay, you're a perfect example of why this is ignorant fiscal policy. A 6-figure earner with plenty of disposable income. Let's say you buy that $50k auto @ 7% and use the defacto standard 35% tax bracket. Does that $1000 savings in the first year make or break you? And consider where that $1k is coming from: Saudi Arabia, China, Russia are a few of the US' largest creditors. Or if we just print it, the money will come out of our kids' pockets in the long run. The most ignorant part is, once again, the people that need help don't buy $50k cars and they're not in a 35% tax bracket which means this tax break is worthless to them. On the plus side, since most people won't save much, it actually won't cost nearly as much as the estimates propose.

I'd rather we all continue to be stimulated by pics of Claymates.
:cheers2:

Take an economics class the only way we will get out of this recession is when people start buying again.The auto makers bring back the people that got layed off the parts suppliers get busy then there employees start spending money again and the government collects tax which was more than the deduction.The single mother on welfare does not stimulate the economy people who work do this will help get people working again

 

[clayinaustin]

I believe that the idea is to stimulate new auto sales. I was planning to wait until 2010 (or later) to buy a new truck to tow my Cigarette. However, if there is a tax savings in 2009, then I may decide to buy a new truck now. If thousands (perhaps tens of thousands) of people are having the same thought, then this should "stimulate" new car sales.

The whole idea behind the stimulate package is to get our consumption-baised economy moving. I would much prefer creative tax breaks to people than billion dollar loans to companies that aren't selling their products. If the government can devise ways to get people to spend, then everything will fall into place.

Just my two-cents...

 

[JupiterSunsation]

Another dumb idea.........The car market is totally upside down(as in your trade is worth nothing), who needs a car if you don't have a job to go to and why would most people want to add another payment to their life in uncertain times?

I own 3 paid off trucks for work (03, 04 and 05) and couldn't fathom starting up another payment book. My wife's Mercedes GL is 2 years old and I couldn't imagine the hit I would take trading that in for an identical truck just to write off the interest........

 

[sledge]

Take an economics class

Thank you Professor. I don't know how I earned my degrees without an economics class...or six. :biggrinjester:

Tax-incentive based consumption is short-lived and short-sighted.

Leverage-based over consumption, excess production capacity and inventory combined with a rapid spike in energy costs and wildly fluctuating interest rates is what got us here. Inventories and capacity have to work themselves down and energy costs and interest rates have to find a natural level and stay there for a while. Also, and I've said this before, it won't be long before banks start to lend again because that's the way they make money.

 

[Expensive Date]

Thank you Professor. I don't know how I earned my degrees without an economics class...or six. :biggrinjester:

Tax-incentive based consumption is short-lived and short-sighted.

Leverage-based over consumption, excess production capacity and inventory combined with a rapid spike in energy costs and wildly fluctuating interest rates is what got us here. Inventories and capacity have to work themselves down and energy costs and interest rates have to find a natural level and stay there for a while. Also, and I've said this before, it won't be long before banks start to lend again because that's the way they make money.

Sorry I thought it was stupidity and people wanting to live beyond there means that got us here.Bottom line is most banks won't finance vehicles on a floor plan for over a year.Many dealerships are aproaching that time frame and may close because of it.This will cause more jobs to be lost and ultamitly hurt the consumer. My Dually was on a lot for 14 months when I bought it
I am not an economics proffessor just have run my own bussieness which I own 100% for 16 years never paid a bill late in my life so I think that has to count for something

 

[Sea-Dated]

They can let you right off the whole price of the car and it is not going to matter when people can't get financed to buy it in the first place.......

 

[Expensive Date]

I had no problem getting a loan for the Dually at 4%.The banks will lend if you credit is good and you are not maxed out.

 

[Sea-Dated]

I had no problem getting a loan for the Dually at 4%.The banks will lend if you credit is good and you are not maxed out.

I had no problem, got 4.5% on the Land Rover we bought in December, but I have heard a lot of people complaining about not being able to get loans.....