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IRS certifies Ford hybrids for tax deduction

November 22, 2010

The Internal Revenue Service has certified Ford’s hybrid SUVs as eligible for the clean-burning fuel deduction.


The certification means that customers who buy either a model year 2006 Escape hybrid or Mercury Mariner hybrid in 2005 may claim a tax deduction of up to $2,000, according to a report on FCN and the Auto Channel.


The Escape and Mariner hybrids join a select list of vehicles certified by the IRS. The 2005 Escape hybrid already appeared on the list of clean-fuel vehicles. Along with Ford and Mercury, the list includes only six other vehicles from Lexus, Toyota and Honda.


The deduction amount for the Escape and  Mariner hybrids was determined after Ford showed the IRS the incremental cost related to the vehicles’ electric motor and related equipment.


It is a one-time deduction and must be taken in the year the vehicle is first used, and it must be taken by the original owner.


The deduction does not apply to leased vehicles.