(MONEY Magazine) – With a $19,995 sticker price, the Toyota Prius, one of two hybrid cars now on the market, may not seem like a bargain. (A Toyota Corolla of a similar size lists for only $12,983.) But tax incentives for buyers of hybrids--they have electric motors and gasoline engines that work together to reduce fuel consumption and emissions--are making it easier to be green. The IRS has issued no ruling on whether hybrids are eligible for existing tax breaks that apply to other low-emission vehicles. But if a plan proposed by Utah Sen. Orrin Hatch (and adopted by the Bush energy plan in May) passes in its current form, new Prius owners should be eligible for around $3,000 in federal tax credits in 2002. Many states (check www.evaa.org for a list) already offer their own incentives. Colorado, for example, provides a credit of up to $3,500. Plus you'll save money at the gas pump--about $170 a year vs. a Corolla CE, and $360 vs. a Camry V-6, assuming you pay $1.47 a gallon and drive 10,000 miles a year.

--MEGAN JOHNSTON