Oklahoma – Time to buy a Brammo Enertia

UPDATE: Looks like Oklahoma amended the statute and phased this out after July 2010.  Sorry, Okies.

 

We’ve talked about California and Colorado and the tax incentives that those states have for electric vehicles (including the Brammo Enertia electric motorcycle).  I know your next question:

What about Oklahoma?

Oklahoma.  Imagine riding an Enertia and actually being able to hear it when the wind comes right behind the rain.  Imagine being able to smell the waving wheat, which can sure smell sweet, at least when you aren’t overcome by the smell of burning fossil fuels.

Oklahoma, the state where, every night, your honey lamb and you can sit alone and talk about one of the best tax incentives for electric vehicles in the United States.

Disclaimer: Don’t get your tax or other financial advice from anyone whose online name ends in -fan.  This means: do your own homework on this purchase.  I’m just trying to get you to think.

Let’s start at the beginning:

Oklahoma Statutes Title 68, Section 2357.22 – “One-Time Credit Against Income Tax for Investments in Qualified Clean-Burning Motor Vehicle Fuel Property.”  With an alluring title like that, you know you’re in for a treat if you did a little deeper, right?  Here’s the basic language, followed by my translation:

For tax years beginning before January 1, 2015, there shall be allowed a one-time credit against the income tax imposed by Section 2355 of this title for investments in qualified clean-burning motor vehicle fuel property placed in service after December 31, 1990, and for investments in qualified electric motor vehicle property placed in service after December 31, 1995.

Translation: Buy a Brammo? Get a tax credit.  Oklahoma does not discriminate against motorcycles – the law says that a motor vehicle has to be “originally designed by the manufacturer to operate lawfully and principally on streets and highways.”

Question: How much is the credit?  Again, here’s the basic language, followed by my translation:

There shall be a one time credit allowed for . . . investments in qualified electric property. The credit shall be 50% of the cost of . . .  qualified electric motor vehicle property as defined in Title 68 O.S. Section 2357.22 and Rule 710:50-15-81.

Translation: Buy a Brammo? Get a $3997 tax credit (50% of the $7995 cost of the Brammo Enertia).

Question: How do I get this tax credit?  (Do I have to do everything for you?  Okay, here you go, but please keep it to yourself — if Ms. Brammofan finds out about this, she might make me do the taxes this year) When you are filling out your State Income Tax forms, you would grab the “Other Credits” form (Form 511CR) and fill in Line #3 with this number: 3997.  You will also need to attach a copy of the paid invoice for the vehicle.

Question: When do I get my check?  Okay, Einstein, you don’t really “get a check,” as this is not a rebate like you would get if you lived in California. Rather, it reduces the amount you would have to pay in Oklahoma State income tax.  So, for example, if you owed $10,000 in Oklahoma State Income taxes for 2010, then this tax credit would reduce your tax liability to $6003.00.  And, if you couldn’t use the tax credit all in one year because your income tax liability was less than $3997, the law allows you to use it over the course of three years.

Question: So, my final out of pocket cost on the Brammo Enertia in Oklahoma is $3997? No, it’s actually better than that.  You still get the Federal tax credit of 10 percent the cost of the bike: $799.  So. . .

7995 (Cost of Enertia) – 3997 (Oklahoma tax credit) – 799 (Federal tax credit) = 3199.

$3199

Before you celebrate by going to brammo.com/store ,  there are some other variables to consider: Brammo charges a shipping charge of “$500 or less” plus applicable taxes.  According to this chart, Oklahoma charges 4.5% on sales.  That would add about $360 to the initial out-of-pocket cost.  There may be other fees and taxes I don’t know about (like county and city taxes), but let’s assume you get the full $500 delivery charge plus the $360 sales tax.  That would bring the initial out of pocket to: 7995 + 500 + 360 = 8855.  Applying the tax credits to that amount (8855 – 3997 – 799) = 4059, which is still pretty awesome.

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