WASHINGTON -- U.S. incentives paid to dealers under the cash-for-guzzlers program wont be treated as taxable income, a spokesman for the National Automobile Dealers Association said Monday.
Theres no net taxable income for the dealers, said the NADA's Bailey Wood, citing a clarification by the National Highway Traffic Safety Administration.
Confusion over the tax question had prompted Wood earlier in the day to call the issue dealers No. 1 concern about the program. He said NADA was seeking clarification from NHTSA and the IRS.
Its amazing how quickly NHTSA has been working on this, Wood said.
NHTSA is administering the Car Allowance Rebate System program, which provides $3,500 and $4,500 U.S. rebates to entice consumers to trade their old vehicles for more fuel-efficient new ones.
At a press conference Monday to kick off the program, U.S. Transportation Secretary Ray LaHood said that so far 17,000 dealers have submitted applications to participate in the CARS initiative.
LaHood said the DOT, which includes NHTSA, has received more than 45,000 phone inquiries and the programs Web site, cars.gov, has received more than 1.5 million hits.