DEFINITION of 'Alternative Motor Vehicle Credit'

A tax credit given to individuals who purchase vehicles that derive their power from alternative energy sources. Taxpayers are eligible to receive this nonrefundable alternative motor vehicle tax credit if they are the original purchasers of a vehicle after January 1, 2006. The vehicle must also qualify and the resulting tax credit will vary depending on the model.

BREAKING DOWN 'Alternative Motor Vehicle Credit'

The alternative motor vehicle credit is designed to encourage the purchase and use of alternative fuel vehicles. The tax credit is claimed on Form 8910, and is credited to the taxpayer after all other nonrefundable credits have been subtracted from the taxpayer's tax liability. If the vehicle is used for business, then it is carried to Form 3880 for the general business credit. Information on qualifying vehicles can be found on the IRS website.

RELATED TERMS
  1. Qualified Electric Vehicle

    An electric vehicle that qualifies the owner to claim a nonrefundable ...
  2. Non-Refundable Tax Credit

    A tax credit that can't reduce the amount of tax owed to less ...
  3. Tax Credit

    An amount of money that a taxpayer is able to subtract from the ...
  4. Alternative Fuels Tax Credit

    A non-refundable tax credit awarded to taxpayers who use non-alcohol ...
  5. Additional Child Tax Credit

    A refundable credit that can be claimed by taxpayers who are ...
  6. Child Tax Credit

    A credit given to taxpayers for each dependent child that is ...
Related Articles
  1. Taxes

    Give Your Taxes Some Credit

    A few tax credits can greatly increase the amount of money you get back on your return.
  2. Taxes

    5 Tax Credits You Shouldn't Miss

    If you're not taking advantage of these deductions, you could be missing out on tax savings.
  3. Retirement

    Saver's Tax Credit: A Retirement Savings Incentive

    Here's another reason to put money toward your retirement nest egg.
  4. Taxes

    Get A Tax Credit For Your Foreign Investments

    The foreign tax credit provides a break on investment income made and taxed in a foreign country.
  5. Taxes

    What's IRS Form 1040 For?

    Most U.S. taxpayers will be familiar with the 1040. By the end of filling it out, you'll know how much tax you owe, or what your refund is.
  6. Investing

    Do Oil Prices Affect The Auto Industry?

    Based on an understanding of complementary and substitute goods, the American auto industry is exhibiting expected effects from the recent plunge in the price of oil.
  7. Personal Finance

    All Three U.S Car Makers See Canadian Sales Grow (F, GM)

    Ford, General Motors and Fiat Chrysler were all able to post increased sales in Canada for the month of June.
  8. Taxes

    Top Tax Refunds For Recent Grads

    Don't miss out on these tax credits if you have recently graduated.
  9. Taxes

    Tax Credits That Can Get You a Refund

    Here are a few of the credits that may result in a refund check, even if you owe no taxes this year.
  10. Personal Finance

    How To Establish A Credit History

    Can't get a credit card without a credit history, and can't get a history without a card? Break the Catch-22.
RELATED FAQS
  1. How do I sign up for the saver's tax credit?

    The saver's tax credit is a non-refundable tax credit available to eligible taxpayers in the U.S. who make contributions ... Read Answer >>
  2. What are some good alternatives to taking out a line of credit?

    Read more about how opening a line of credit might not be the best answer for you and determine available alternatives if ... Read Answer >>
  3. Is it possible to have a credit limit that's too high?

    Avoid these pitfalls when working with high credit limits, and learn how to increase your credit score by increasing your ... Read Answer >>
  4. What is the difference between bad credit and no credit?

    The answer to this question will depend on what information (if any) is found on your credit report, such as any bankruptcy ... Read Answer >>
  5. What is the difference between a write-off and a deduction?

    Understand the differences between a tax write-off and a tax deduction. Learn how each one works to reduce income taxes and ... Read Answer >>
  6. What's the difference between a credit rating agency and a credit bureau?

    Learn how to differentiate between credit rating agencies and credit bureaus, two industries that distribute valuable risk ... Read Answer >>
Hot Definitions
  1. Cash Flow

    The net amount of cash and cash-equivalents moving into and out of a business. Positive cash flow indicates that a company's ...
  2. PLUS Loan

    A low-cost student loan offered to parents of students currently enrolled in post-secondary education. With a PLUS Loan, ...
  3. Graduate Record Examination - GRE

    A standardized exam used to measure one's aptitude for abstract thinking in the areas of analytical writing, mathematics ...
  4. Graduate Management Admission Test - GMAT

    A standardized test intended to measure a test taker's aptitude in mathematics and the English language. The GMAT is most ...
  5. Magna Cum Laude

    An academic level of distinction used by educational institutions to signify an academic degree which was received "with ...
  6. Cover Letter

    A written document submitted with a job application explaining the applicant's credentials and interest in the open position. ...
Trading Center