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5 Fuel Efficient Cars to Maximize Your Clunker Tax Credit

Updated on July 10, 2009

Cash for Clunkers Tax Credit

A lot of people have been doing research on this new law recently signed by President Obama.  Under the CARS Act, you can get a tax credit up to $4500 towards the purchase of a new more fuel efficient car.  If you're currently driving a clunker as defined by the law, you may be eligible to receive this cash towards the purchase of a new car (visit this hub for more details: $4500 tax credit).  If you have a car that currently gets a "new" combined city/highway fuel economy of18 mpg or less, you may qualify.  To maximize your credit, the new car you purchase has to have an increased fuel economy of at least 10 mpg for a new car, or 5 mpg for a new light truck or SUV.

Here's a list of 5 fuel efficient cars that are sure to qualify as a suitable replacement for your clunker.

2010 Toyota Prius

This is a day and age where Prius is synonymous with the term fuel efficient.  No top list of fuel efficient cars would be complete without the Toyota Prius mentioned.  It is the icon that all other fuel efficient cars wish to live up to.  With a fuel economy of 51 mpg / 48 mpg / 50 mpg (City / Highway / Combined), you can't go wrong if green is your favorite color.  Starting at $22,000 for the lowest model, a $4500 tax credit is the same as saying I'm going to give you 20% just for handing over the keys for your gas guzzler.  Who can say no to that?

2009 Honda Civic (Hybrid)

So I was torn about which way to take this... Honda Civic or Honda Civic Hybrid? When it comes down to it, both will get the job done and earn you that tax credit. If you're looking for a practical car without paying the premium price for a hybrid, stick with the standard Honda Civic. Starting at $15,305 with a fuel economy of 25 mpg / 36 mpg / 29 mpg (City / Highway / Combined), you can't go wrong. Be watchful though, if you upgrade the engine to the 2 L, depending on how much gas your clunker sucks down, you may not qualify for the tax credit. If you see life in green though, and don't mind the premium you pay for a hybrid engine, you can up your fuel economy to 40 mpg / 45 mpg / 42 mpg (City / Highway / Combined). I'm not sure if the premium is worth it though as the hybrid models start at $23,650 - I'll let you decide though. :)

2009 Nissan Altima Hybrid

If you're looking for sheer driving enjoyment (oh, yeah and decent fuel economy), you can't go wrong with the 2009 Nissan Altima Hybrid. That's assuming you're one of those lucky folks who live in the eight states where they're sold - California, Connecticut, Maine, Massachusetts, New Jersey, New York, Rhode Island and Vermont.  Starting at $26,650 this model is sure to please.  With a fuel economy of 35 mpg / 33 mpg / 34 mpg (City / Highway / Combined), you can't really complain either.  While it's not as good as the Honda Civic Hybrid or the Toyota Prius, let's face it - if you're buying an Altima, it's not because you're looking to be practical.

2010 Ford Fusion Hybrid

I would be remiss if I didn't get at least one American car on the list.  President Obama would not be happy after investing so much in American car companies (ironically GM and Chrysler isn't on this list).  In any case, if you feel that it's your patriotic duty to buy American, than look no further than the Ford Fusion Hybrid (assuming fuel economy is what's on your mind).  Starting at $27,270 and having a fuel economy of 41 mpg / 36 mpg / 39 mpg (City / Highway / Combined), there's not much to complain about it.  If you're looking for an American made sedan, this is a solid vehicle.  If you're looking to class it up a bit, check out the 2010 Mercury Milan Hybrid - the gas mileage is the same, but you get to pay a bit more for that upscale ride.

2009 Ford Escape Hybrid

For all you SUV lovers out there, I didn't forget you!  Yes, it is possible to own an SUV that doesn't require you sell a kidney to fund it's gas guzzling habit.  They actually make SUVs that get better gas mileage than most cars - amazing how technology works.  For the low price of $29,750 you can be the proud owner of an SUV that gets an amazing 34 mpg / 31 mpg / 32 mpg (City / Highway / Combined) - that wasn't a typo.  While it's no Prius or Civic fuel economy, this is an SUV we're talking about... and it's American made!  I guess we can have our cake and eat it too!


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