WASHINGTON (CNN) - U.S. buyers of the Toyota Prius, the Honda Insight and other hybrid gas-electric cars may soon be getting a nice tax break.
The hybrid cars will qualify the original buyers for a federal income tax deduction of up to $2,000, the Internal Revenue Service said.
The amount of the deduction hasn't yet been set, and will depend on how much extra was spent to put electric power into the vehicles, the IRS said. The agency is asking for that cost information from car makers, and the process could take several months.
Once the IRS sets the amount, original buyers of hybrid cars may use that to reduce their taxable income, even if they don't itemize other deductions and claim the standard deduction instead, the IRS said.
Also, persons who bought hybrid cars last year or the year before can claim a refund by submitting an amended return, the IRS said.
Honda's Civic Hybrid will become the first mainstream vehicle to be equipped with a combination gasoline-electric power system.
Toyota claims 90 percent of the world market for hybrid vehicles and sold 1,834 Prius models in the United States last month, the company said in a news release. It began selling the Prius in the U.S. in 2000. The Honda Insight, introduced in 1999, was the first such car available to the public.
Hybrid car buyers had been asking if they qualify for a deduction under existing tax law aimed at subsidizing cars using "clean-burning" fuel. The IRS said electricity is a clean-burning fuel.
Honda launched its two-seat Insight model in December 1999, and the four-door Toyota Prius went to market a few months later. Honda also plans to unveil a hybrid version of its popular Civic, the first mainstream vehicle to be equipped with a combination gasoline-electric power system.