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Buy A New Wheelchair Van in 2009, Get A Deduction!

Posted by on Tuesday, February 24th, 2009

As we’ve all heard, the economic stimulus package was signed into law in February. One of the things added to the bill was a temporary provision that allows people who buy new automobiles in 2009 to deduct any state and local sales and excise taxes on that purchase from their taxable income. This would include taxes on the chassis for new handicap ramp vans, so I thought it would be helpful to outline details of the deduction here on the blog.

Details of the Sales Tax Deduction

  • The deduction is available to purchasers of new wheel chair vans in 2009, from January 1st to December 1st. Only the tax on the chassis is deductible, not the tax on the accessible conversion by BraunAbility.
  • You may deduct state and local taxes and any excise taxes charged on the chassis purchase.
  • The deduction is available to those earning less than $125,000 ($250,000 for joint filers).
  • You can deduct the sales tax on the first $49,500 of a chassis price.

This deduction is an “above-the-line” deduction, which means you can take it regardless of whether you itemize other deductions on your tax return.

A Real-World Example

Here’s a quick example of how the tax deduction would work in the real world. Let’s say you buy a new Entervan or Rampvan, and paid $30,000 for the chassis alone. If you had a trade-in of $6,000, typically states would tax the difference between the new car and the trade, which in this instance would be $24,000.

At a tax rate of 6.5%, that would mean your deduction in this case would be about $1,560. Tax rates vary by state, so of course your deduction will be based on the tax rate in your state. If you are buying the same ramp van with no trade, you would deduct even more – $1,950 at our example 6.5% tax rate.

On top of this deduction, remember that in most states the cost of the conversion itself is typically exempt from sales tax – be sure to check with your local BraunAbility dealer for details.

Is Now the Time?

If you’re like me, you’ve been wondering if this is the right time to purchase a new vehicle. This new deduction, coupled with various incentives currently offered by the car companies, make the purchase price of a new wheelchair van very attractive. Of course, only you can decide if the numbers add up for your situation. You may want to check with your accountant, and of course you can always visit your local BraunAbility Dealer to see the wheelchair vehicles they currently have in inventory.

I’d like to end with a disclaimer: I’m not an accountant – I don’t even play one on TV! Talking about taxes typically makes my head hurt. If you can add any details to this that I may have overlooked, please leave a comment below!

6 thoughts on “Buy A New Wheelchair Van in 2009, Get A Deduction!

  1. Jack Post author

    Howard,

    You would need to check with your accountant to be sure, but I would assume wheelchair vans are treated like regular vehicles in the eyes of the IRS.

    Jack

  2. Howard Gray

    Can you take the sales tax deduction a wheelchair van if you purchased it before 2/6/09? That is the cutoff date for regular vehicles

  3. Jack Post author

    Hi Tom,

    So glad the van is working out for you! As for your taxes, you “may” be able to deduct the cost of the conversion (not the chassis itself) if you have a doctor’s prescription for the accessible equipment. This deduction would be itemized under medical expenses.

    I use the quotations as a caution because I’m definitely not an accountant! I’d advise you to consult with your tax adviser as there may be state or local issues I’m unaware of.

    I hope that gets you started – let me know if I can answer any other questions.

    Jack

  4. thomas carter

    We purchased a Toyota Limited from Ability Center in Phoenix 11/08. We had a VMi trade. Can we write off any of the van cost for 2008 taxes ad where. We can’t find any information about this subject. Don’t try asking the IRS.

    By the way what a difference between Braun and VMI. We are very happy with the Van and so far trouble free.

    Tom Carter

Comments are closed.

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