2013 Titanium sitting on lot for months

[wazer]

I'm 22 and graduating from college in a few weeks, and looking to get rid of my Accord and lease a new Fusion Energi!

Being in Indiana right now, I won't be moving out to Iowa for two more weeks, but I have been eyeing the local Ford dealer's Energi stock for a while. I finally requested some info on it, and they have told me that the car has been on their lot for at least 6-7 months. Wondering what everyone's opinion is on an Energi that has been sitting for so long, and how good of a deal I may be able to get? It doesn't have things I would want like ACC, driver assistance package, & cooled seats, but being a Titanium, remote start, Sony sound, and a moonroof should do just fine for now. If I wouldn't be able to get a good lease deal, I will consider placing an order for the color & options I want.

 

http://www.dahlford.com/vehicle-details/2013-ford-fusion-energi-titanium-davenport-ia-id-5443338

 

http://www.inventory.ford.com/services/inventory/WindowSticker.pdf?vin=3FA6P0SU9DR383308

[Russael]

It's got a fairly late build date for the 2013 model year, so most of the bugs 'n stuff that the early builds had won't be a problem.

 

The only issue they'll likely have is a dead 12v battery.  You should be totally fine in leasing that ride.  The High Voltage Battery pack, once being charged and discharged a couple times through normal driving, should bring capacity back to what it should be... I know lead acid batteries after sitting for 6 months or so, need a couple charge cycles to bring the capacity back.  I don't THINK Li-ION batteries do, but it won't hurt it in the long run.

 

Besides, you're leasing it.  It won't be yours in 2 - 3 years unless you decide to buy it out. :)

[apm]

Hi Wazer,

 

Keep in mind that Ford lowered the price for the 2014 Energi by $4000. I'm not sure what kind of incentives Ford is offering on the 2013, but in the end the price of a 2013 should come out lower than a 2014 or otherwise it makes more sense to buy a 2014. 

 

Regards,
APM

[JATR4]

USAA has a price for a 2014 with the same options for $35,830 (MSRP of $39,510).  If they roll the $4,007 tax credit into the lease that is a target price of $31,823.  But that is for a 2014.  You should get more off since it is a 2013.

[wazer]

USAA has a price for a 2014 with the same options for $35,830 (MSRP of $39,510).  If they roll the $4,007 tax credit into the lease that is a target price of $31,823.  But that is for a 2014.  You should get more off since it is a 2013.

Is that x plan pricing with USAA? I would have access to x plan through my employer.

[JATR4]

Is that x plan pricing with USAA? I would have access to x plan through my employer.

Don't think so.  That is just their recommended price.

[wazer]

I appreciate your input. I am reconsidering leasing, and just buying instead. But now I am considering the C-Max Energi, as it is a little cheaper in MSRP, insurance, and registration costs. I really like the looks and interior of the Fusion, but I'm 6'4" and the tall C-Max fits me nicely. Thoughts?

[JATR4]

Will you have enough income to take advantage of the tax credit?

[wazer]

Will you have enough income to take advantage of the tax credit?

I didn't know there were income requirements/restrictions to get the $4007 tax credit. What are they?

[murphy]

You have to have enough taxable income to owe the IRS at least $4007 to be able to get the full tax credit.

[wazer]

Hmm. How do I know if I will be able to get the full amount? This is the first I hear of this. Do you have a link to a webpage that I can learn more?

[Russael]

You can take a look at your 1040 from 2013 and you'll see what you paid the feds.  If it was greater than 4007, you will be able to claim the entirety of the credit, assuming you make the same or more money than 2013.  If you did not pay the feds more than 4007, then you'll be able to receive partial credit.  The rest would be lost.  This doesn't work like a rebate where you'd get that money regardless of how much the feds said you owed... it's just used to reduce your federal liability.

[murphy]

Hmm. How do I know if I will be able to get the full amount? This is the first I hear of this. Do you have a link to a webpage that I can learn more?

Look at the tax return that you just filed.  Line 61 of form 1040 is the amount of tax that you owed to the IRS for 2013.

 

That line on your 2014 return, that you will file in 2015, is the maximum tax credit that you can claim.

 

This is a simplification.  I don't know what the line numbers are if you filed a 1040A.

[wazer]

I think I found it on my 1040EZ, line 10. I can't really use this as an estimate because my jobs have consisted of part time work at school and a full time 3 month paid summer internship. I'll be working at the same company I interned at, though, starting in June for the rest of the year.

 

If I leased, the dealer would be able to use the full tax credit regardless of my income, correct? And this would in turn give me lower monthly payments. 

[Russael]

Well, more oversimplification, but it seems the break-even point for being able to claim the whole tax credit is that your gross income, after pre-tax deductions, needs to be equal or greater than $27,000 for the tax year (if you don't claim anything else at tax time).  15% of 27k is $4050.

 

If you don't make that, you can't claim the whole credit for purchase.

 

On the flipside, if you choose to lease it, then they will roll that credit in to your lease payments.  They CAN claim the whole credit and pass that on to you.  Then you can buy out the vehicle at the end of your lease.

[blars]

The $4007 was listed as a "dealer incentive" on my lease paperwork, if I remember correctly.  The first dealership I went to said that I could claim the tax credit on my return next year, in addition to that "dealer incentive".  That is not the case.

[murphy]

If you lease, the leasing company owns the car and they get the credit.  Usually they will pass it through into the lease contract.

 

The credit can only be claimed on your tax return if you buy the car outright.

[wazer]

Got it, thanks. Looks like I would have to wait to purchase until next year if I wanted to take advantage of the entire tax credit. 

[wazer]

I'm still not sure how much I can save on this 2013 model though. If I can get a good enough deal, the extra tax credit may not matter.

[JATR4]

I'm still not sure how much I can save on this 2013 model though. If I can get a good enough deal, the extra tax credit may not matter.

The tax credit does matter.  That is why we buy the ENERGI--for the mileage and the tax credit.  $4.007 is real money.  If you can get a good lease where they give you the credit as part of the lease, that may be your best bet.  Just do your homework. 

 

If you are single you need almost $40,000 income to take full advantage of the credit.  Tax on $40,000 with standard deduction and one exemption and no other income is $4,058.

[wazer]

Right. I would easily be able to get the full credit if I purchased next year because I will have more than enough income. If I purchased this year, I would fall short on income. 

[Rexracer]

You should get at least 10k off MSRP on a 2013, and more like 12k off. This is not including the federal tax credit. I got 10k off back in December, so now that is almost May, I would expect even more off. BUT it sounds like if you dont have the income to claim the credit, then leasing or waiting a year is a better option.

 

Honestly, just getting out of school at 22, I would wait a year, so much can change in the next 12 months after getting out of school you may end up not wanting a car at all.

[wazer]

Good guidelines. So $12k off MSRP of $43k, plus the $4500 off in ford rebates listed, PLUS the $4007 tax credit?

 

Edit: I see that $4500 in rebates is available for financing only, but there's also "Offer 1: $4500 Ford Cash"?

Edited April 29, 2014 at 07:38 PM by wazer

[blars]

Pretty sure rexracer was including the rebates in the discount off msrp. No way you'd get under 30k before the tax credit.

[Rexracer]

Good guidelines. So $12k off MSRP of $43k, plus the $4500 off in ford rebates listed, PLUS the $4007 tax credit?

 

Edit: I see that $4500 in rebates is available for financing only, but there's also "Offer 1: $4500 Ford Cash"?

Blars is correct, the 4500 in rebates plus dealer discounts to get to the 12k off. I got 10k off like this in December. I "think" 12k is possible, but totally up to how much the dealer is willing to negotiate. Maybe ask for 12k off or 10k plus the extended warranty?