For Tax Year 2010 and Earlier: Taking the Hybrid Car Tax Credit
Taxpayers who purchase new, hybrid vehicles could be eligible to claim a tax credit worth as much as $3,400 on certified 2010 vehicles. A credit reduces taxes owed dollar for dollar.
The amount of the credit varies by vehicle make and model. Visit the IRS website for qualified 2010 vehicles.
Buyers of hybrid cars should be aware of certain limits and restrictions. For example, the amount of the credit for a specific car begins to phase out as more of that manufacturer's cars are sold.
For more information, see the IRS article on Qualified Hybrid Vehicles.