The vast majority of financial advisors and credit counselors are telling people to cut back on spending these days, pay down personal debt and build up nest eggs. Rarely do you read or hear about the wisdom of spending money in this difficult economy.
However, if you have cash on hand plus a high credit score, it's an excellent time to purchase undervalued real estate in key locations. It's also a good time to buy stocks of sound companies whose shares have dropped in price.And, here's another consideration, one you may not have thought of -- motorcycles and scooters! When oil prices soar, these two- and three-wheelers are a great alternative to gas-guzzling cars, provided you don't mind a few raindrops falling on your head.
They also come with tax breaks. Under the government's recently approved stimulus package, taxpayers are now allowed to deduct sales and excise taxes on the purchase of most new cars and trucks. The same is also true for new motorcycles and scooters.
To qualify for the tax break you: 1) must purchase a new scooter or cycle; 2) it must be an "on-the-road" model; and 3) the purchase must be made between February 17 and December 31, 2009.
In addition, the law allows for a new 10% federal tax credit, up to $2,500 for two or three-wheeled vehicles with electric motors - in other words, models that can be plugged in. These must be manufactured primarily for use on public streets, roads and highways. The 10% federal credit applies to purchases made up until December 2011.
Single taxpayers with an adjusted gross income over $125,000 and married taxpayers with an adjusted gross income over $250,000 are not eligible for any of the above tax breaks.
You do not need to itemize to claim the deduction.
$TIP: Some manufacturers are also offering rebates and free accessories.
New scooters cost anywhere from $1,000 to $10,000. Motorcycles range from $3,000 to $10,000 or more.
Bottom line: Don't buy a scooter or cycle just because of the tax breaks...but if you're looking for inexpensive transportation, one might just be the right solution.
For help in selecting the right model, check the March issue of Consumer Reports. The focus of the article is on vehicles for people with no experience but who don't want to drive a car to work. And, hey...the parking will be easier! Nancy's New Book Is Here! |
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- Nancy Dunnan
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