§ 1.25E-0. Table of contents.

§ 1.25E-1 Credit for previously-owned clean vehicles.

(a) In general.

(b) Definitions.

(1) Advance payment program.

(2) Credit transfer election.

(3) Dealer.

(4) Dealer tax compliance.

(5) Electing taxpayer.

(6) Eligible entity.

(7) Excessive payment.

(8) Incentive.

(i) For purposes of sale price.

(ii) For purposes of eligible entity requirements.

(9) Modified adjusted gross income.

(10) Placed in service.

(11) Previously-owned clean vehicle.

(12) Qualified buyer.

(13) Qualified manufacturer.

(14) Qualified sale.

(15) Registered dealer.

(16) Sale price.

(17) Section 25E regulations.

(18) Seller report.

(19) Time of sale.

(20) Vehicle history report.

(c) Limitation based on modified adjusted gross income.

(1) In general.

(2) Threshold amount.

(3) Special rule for change in filing status.

(d) Credit may be claimed on only one tax return.

(1) In general.

(2) Seller reporting.

(e) Examples.

(1) Example 1: First transfer since enactment of section 25E.

(2) Example 2: Multiple transfers since enactment of section 25E.

(3) Example 3: Multiple transfers; commercial purchaser.

(4) Example 4: Multiple transfers; buyer exceeds modified adjusted gross income limitation.

(5) Example 5: Multiple transfers; buyer elects to not take credit.

(6) Example 6: Multiple transfers; sale between dealers.

(f) Reliance on vehicle history report for purposes of determining whether sale is a qualified sale.

(g) Severability.

(h) Applicability date.

§ 1.25E-2 Special rules.

(a) In general.

(b) No double benefit.

(1) In general.

(2) Interaction between section 25E and 30D credits.

(c) Recapture.

(1) In general.

(i) Cancelled sale.

(ii) Vehicle return.

(iii) Resale.

(iv) Other returns and resales.

(2) Recapture rules in the case of a credit transfer election.

(3) Example: Vehicle return.

(d) Branded title.

(e) Seller registration.

(f) Requirement to file income tax return.

(g) Taxpayer reliance on manufacturer certifications and periodic written reports to IRS.

(h) Severability.

(i) Applicability date.

§ 1.25E-3 Transfer of credit.

(a) In general.

(b) Definitions.

(1) Advance payment program.

(2) Credit transfer election.

(3) Dealer tax compliance.

(4) Electing taxpayer.

(5) Eligible entity.

(6) Registered dealer.

(7) Time of sale.

(c) Dealer registration.

(1) In general.

(2) Dealer tax compliance required.

(3) Suspension of registration.

(4) Revocation of registration.

(d) Credit transfer election by electing taxpayer.

(e) Federal income tax consequences of credit transfer election.

(1) Tax consequences for electing taxpayer.

(2) Tax consequences for eligible entity.

(3) Form of payment from eligible entity to electing taxpayer.

(4) Additional requirements.

(5) Examples.

(i) Example 1: Electing taxpayer's regular tax liability less than amount of credit.

(A) Facts.

(B) Analysis.

(ii) Example 2: Non-cash payment by eligible entity to electing taxpayer.

(A) Facts.

(B) Analysis.

(iii) Example 3: Eligible entity is a partnership.

(A) Facts.

(B) Analysis.

(f) Advance payments received by eligible entities.

(1) In general.

(2) Requirements for a registered dealer to become an eligible entity.

(g) Increase in tax.

(1) Recapture if electing taxpayer exceeds modified adjusted gross income limitation.

(2) Excessive payments.

(i) In general.

(ii) Reasonable cause.

(iii) Excessive payment defined.

(iv) Special rule for cases in which electing taxpayer's modified adjusted gross income exceeds the limitation.

(3) Examples.

(i) Example 1: Registered dealer is not an eligible entity.

(A) Facts.

(B) Analysis.

(ii) Example 2: Incorrect manufacturer certifications.

(A) Facts.

(B) Analysis.

(h) Return requirement.

(i) Two credit transfer elections per year.

(j) Severability.

(k) Applicability date.