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A Project of The Annenberg Public Policy Center

“Clunkers” Credits Taxable?

Q: Will the "Cash for Clunkers" credits be taxed as income for consumers who participated in the program?
A: The act establishing the program prohibits the credit from being treated as income for federal income tax purposes. The credits, however, may be subject to a state or local income tax depending on the laws of the state or locality where the consumer resides.

Cash for Clunkers

Q: Fox News’ Glenn Beck said that the government will get complete access to your computer and all of your files when you log on to Cars.gov for the Cash for Clunkers program. Is there any truth to this?

A: This claim is false. Beck quoted from a security message on the site for dealers, not the site for the general public.