Watch Out Clunker Nutters, Taxes Not The End Of It

Clicking back a few links from an original tip from Snapped Shot on the Cash for Clunkers Program:

Here's a new twist to both stories that you probably aren't aware of yet: The $4,500 rebate you "got" from the government was actually taxed both as income and as a purchase?

Even that may not be the end of people's problems.

To sum it all up - higher used car prices, increased cost of repairs due to parts from clunkers now off the market, mechanics have complained of how it will cost them work. If you already bought an efficient vehicle, you got nothing at all for doing the alleged right thing, clunker nutters are getting taxed coming and going. And, now, as the Federal government is running behind, state governments may assess interest and penalties. What a wunnerful, wunnerful idea to always get government involved. The chunk of the clunker money they get back most certainly justifies all this, don't ya think?

Nelson adds that if you did recently purchase a vehicle, ensure your dealer gets you the paperwork in time because if they don't you could pay extra interest and penalties.

Comments

[JustOneMan]

so for a poor shlub in New Jerey...$4,500 actual means $3,150......thats your government!

[tim maguire]

Does the blue value of the car count against the "income"? Typical government, "give" with one hand and TAKE! with the other

[syn]

Yet Obama's advisers (many of whom have Harvard degrees) and that magnificent b*stard Howard Dean think that capitalism is the problem which creates poverty.

[Rich K]

HEHE, Karma is a Biatch Aint It!!
Unintended consequences indeed.

[Xerocky]

Every cent of every $4500 is ours in the first place. It's been taken from taxes. And then those taxes are in turn taxed, 2x.

About a year ago someone said something to the effect of money is credit.
Not anymore, now money is tax. Simply having a U.S. dollar in your pocket will be a tax burden of some sort or another.

Hyperinflation won't describe what's going on. That's a thing of the past. Now having the U.S. currency will cost you your time and goods. Simply accepting a dollar as a payment will only open you up to some tax that you weren't aware of, and in the end it will cost you.

[Xerocky]

Stop and think for a second. They took tax dollars and bailed out the banks, but it wasn't free, it came with a price tag. The costs of being bailed out are going to then get passed on to you,(the banks aren't going to take it on the chin, they're going to pass the costs of borrowing the money along to the consumer) which is ironic because it was your tax money in the first place. Because the Fed will try to keep the rate low to keep things going, these costs will come in the form of endless hidden fees, and then unexpected taxes on the other end, once the money you borrowed is in your account. Hyperinflation doesn't begin to describe this situation. That problem happens because a central bank prints too much money, ala Zimbabwe. But that county is small and it's currency is pegged to a larger currency, so it can't do the same kind of damage that the U.S. dollar can if it's printed in such an irresponsible way.

What were seeing here is different. This is like fiscal mad cow disease. The cows were eating cow and it screwed them up. The taxes are now taxing taxes.

Does anybody see what I'm saying? This simply can not work. With the Federal Govt. eating up the private sector the way it is, every time you get paid you'll be handed more tax money, and to make up the shortfall, they'll have to...raise taxes. So in essence, money is a tax. By accepting your pay check, your simply accepting more tax. By working harder, you're driving up taxes.

[MarkJ]

"Now having the U.S. currency will cost you your time and goods. Simply accepting a dollar as a payment will only open you up to some tax that you weren't aware of, and in the end it will cost you."

With the above in mind, I'm already encountering problems on online auction sites. I regularly deal with a lot of foreign sellers who, in the past, regularly accepted USD in lieu of Euros. No longer--many of them are now flat-out refusing to accept U.S. currency, which forces me, in turn, to either use PayPal (aaargh!) or spend extra money and time ordering Euros through my local bank.

Thank you, President Zero!

[jpe]

It's not taxable. Keloland is wrong. The cash for clunkers program specifically excludes the vouchers from the gross income of the purchaser, and South Dakota is a "gross income" state, meaning that its starting point is federal taxable income. IOW, since it isn't included in federal taxable income, it isn't in SD income.