Clunkers money was not taxable income to buyer.

Apparently, the "Clunkers $" is not taxable to purchasers. http://www.kjrh.com/content/financialsurvival/tulsa/story/Is-your-tax-for-clunkers-taxable/-zAJabMtrkiD61y18Ysq2A.cspx .... Mary Kay called to tell us she's curious about the federal program that gives folks up to $4500 when they trade in certain gas guzzling vehicles and buy more efficient ones. She asks, "Is the $4500 Cash For Clunkers voucher a free gift from the government, or will it be considered taxable income at the end of the year? If taxable, folks may want to consider what that $4500 may net them after taxes are paid on it." It's a good question. So we got in touch with the Oklahoma Society of CPAs. I'm told it will not be considered taxable income for the person who buys the car, so they won't be paying any tax on it. But the dealer will be taxed on the cash it receives for those clunkers that are turned in. Afterall, CPAs tell us, the money the government gives to dealers for the cash for clunkers program, is considered taxable income for them, but not for the customer.

Cash for clunkers: Early on I came close to buying a PT Cruiser.

http://ww2.startribune.com/user_comments/comments.php?d=asset_comments&asset_id=54400982&section=/business

My newer vehicle is a 2005 Ford Ranger with 18K miles. My "clunker" is a 1993 Chev S-10 4x4 with a max towing package and 177K miles. I could have gotten a 2009 PT Cruiser for $10K even with cash for clunkers. Very tempting. I could have paid for it out of savings. My brother, who is a very good mechanic talked me out of it. He says that mechanically the S-10 is very good and I think he likes having the "max towing" package available.

I read that of the 700,000 cars sold, analyst estimated that 200,000 were "disgressionary" buyers, basically people who have money because they didn't spent it. I'm one and love a bargain but with 18K miles on the Ranger I don't need a new vehicle.

Basically, if we are to do a "cash for clunkers" program the goal should be to "shake the money out from "under the mattresses" so to speak. I would specify that there could be no leases or loan liens on the new vehicles. I would also specify that the current owner must keep the vehicle for a period of three years or more with an early sale pro-rated at (let's say) $100 per month. The only exception to this would be a sale due to the death or disability of the owner resulting in permanent loss of driver's licence. ........

First the no loans or lease. Many people have a lot of debt. Admittedly with "clunkers" discount there is a lot less repo loss but debt or lease is still a debt obligation. A lot of the "savers" have money "in the bank/under the mattress". This is the money a stimulus program should be flushing out. I give the $100 per month penalty for early sale to avoid the "resale loophole" that seemed to exist with the current program. Many of the buyers under my scheme would be elderly so the exclusion for death or medically related drivers licence surrender would reassure them. I would exclude a repay exemption for sale after a licence revocation caused by a DUI or other traffic offenses or non-driving related imprisonment.

How come I can figure this out and those Washington lawmakers and bureaucrats can't?

....I will cross post at my http://fourfiftygas.com

Cost of gasoline in other countries.

Published March 13, 2008. Prices not current but it helps you get the idea. The USA averaged $3.22 at the time.

http://articles.moneycentral.msn.com/SavingandDebt/Advice/4DollarGasYesItsOnTheWay.aspx?page=2

First page of article:

http://articles.moneycentral.msn.com/SavingandDebt/Advice/4DollarGasYesItsOnTheWay.aspx?page=1

Global gas prices per gallon

Country	City	Regular	Country	City	Regular
Norway	Oslo	$ 8.42	South Africa	Johannesburg	$ 3.83
United Kingdom	London	8.13	Canada	Toronto	3.71
France	Paris	8.11	Cuba	Havana	3.42
Denmark	Copenhagen	7.70	Pakistan	Karachi	3.28
Germany	Berlin	7.66	United States	National average	3.22
Italy	Rome	7.58	Thailand	Bangkok	3.18
	Hong Kong	7.14	Argentina	Buenos Aires	2.54
South Korea	Seoul	6.63	China	Beijing	2.42
Brazil	São Paulo	5.93	Mexico	Mexico City	2.42
Japan	Tokyo	5.29	United Arab Emirates	Dubai City	1.70
Singapore	Singapore	5.24	Egypt	Cairo	0.89
Kenya	Nairobi	5.16*	Russia	Moscow	0.85
Chile	Santiago	4.80	Kuwait	Kuwait City	0.82
Australia	Sydney	4.76	Saudi Arabia	Riyadh	0.46
India	Mumbai	4.71	Iran	Tehran	0.41
Canada	Montreal	4.04	Venezuela	Caracas	0.12

*Premium
Source: Associates for International Research