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Using your Water Powered Car for IRS refunds
With the increasing awareness of environmental concerns, and the rising problem of fuel costs and availability it has become increasing common for Governments to recognise and reward attempts by drivers to reduce their impact on the environment. These rewards normally come in the form of tax credits, meaning that if you own or run a car that uses less fuel and creates less emissions you will either pay less vehicle tax to start with, or you will be able to claim tax credits back on your annual tax bill.
The Energy Policy Act of 2005 in the USA brought in a tax credit system for those drivers who used environmentally friendly cars or fuels, or those who carried out environmentally friendly upgrades to their existing vehicles.
This tax credit system is subject to some restrictions, so it would be best to contact your local IRS office to double check if your vehicle qualifies, but generally the maximum tax credit you could expect to claim for the most fuel efficient hybrid cars and light trucks is $3,400.
Tax credits are also available on vehicles that are powered by fuel cells, which convert hydrogen into electricity to power an electric motor. These vehicles are not yet widely produced, but you could expect to receive a maximum of $12,000 tax credit if you own one of these vehicles.
If you make additional environmentally friendly upgrades to your existing vehicle there are a number of smaller tax credits available. Currently water fuel upgrades have not been commercially accepted or verified, and so you will need to contact your IRS office to discuss whether they qualify under this tax credit system. Using water fuel as a supplement could potentially qualify under the ‘alternative fuel’ credit system and you will need to keep all your receipts from the purchase and installation of your water fuel system. It would also be helpful if you kept the receipts and records of before and after fuel consumption, and any emissions tests to show that you car is now running more efficiently and cleanly.
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