Dealers To Get 'Clunkers' Cash By Sept. 30

WASHINGTON (AP) -- The government has approved $500 million in reimbursements to car dealers for sales under the Cash for Clunkers program and dealers should be paid by late September, officials said Thursday.

Auto dealers have complained that the Obama administration has been slow to pay them for the car purchase incentives of up to $4,500. The rebates led to 690,114 new sales at a taxpayer cost of $2.88 billion.

A Transportation official said 120,000 submissions from dealers, or about 17 percent, have been approved under the program, which ended on Aug. 24. The official, who spoke on condition of anonymity, was not authorized to speak publicly about the data before a congressional briefing.

All eligible and completed dealer submissions should be fully paid by Sept. 30, the official said. The official said the government is ramping up staff and 5,000 workers will be reviewing paperwork by the end of next week. About 3,000 government and private sector workers are currently working on the project.

The official said the department expects to be approving $100 million per day by the end of next week.

The program, which provided incentives of $3,500 or $4,500 for consumers to trade in a gas-guzzler for a new, more fuel-efficient car or truck, boosted car sales during the summer. U.S. auto sales rose to 1.3 million vehicles in August, a 30 percent increase from July and the first monthly year-over-year gain since October 2007.

Ford Motor Co., Toyota Motor Corp., Hyundai Motor Co. and Honda Motor Co. posted strong sales.

Auto dealers have said the delays have squeezed their businesses, leaving them on a short-term hook for dozens of deals. AutoNation Inc., the nation's largest dealership chain, said Wednesday it was owed more than $54 million from clunker sales and expected to get paid in 30 to 60 days.

Bailey Wood, a spokesman for the National Automobile Dealers Association, said that "while dealers are still floating billions of dollars related to this program on top of their dealerships, we see the new numbers as a step in the right direction." He said the dealership group was encouraged by the Sept. 30 deadline.

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something wrong with these numbers? 9/3/2009 4:33:00 PM Taxpayer cost equals 2.8 Billion dollars. Car dealers get 500 million. Were is 2.3 Billion dollars?
Government finance 9/3/2009 4:48:00 PM We need credit cards to get short term loans the way this cash for Clunkers program works out. I bet sellers are not likely to jump into the next "stimulus" program as fast as auto dealers went into this one. Still can't trust the government to run a business.
Which Sept. 30 ???! 9/3/2009 4:50:00 PM ... notice that no one has mentioned what year ... :-)
Wait a minute!!! 9/3/2009 4:52:00 PM It takes two months to pay only 20% of owed C4C money, this was a known expense!!! Can I pay the IRS on the same schedule that C4C is paying back dealers???
RE: something wrong... 9/3/2009 4:57:00 PM The article states "the government has approved $500 million in reimbursements" but if you read a little further you'll see only 17% of the applications have been approved. As we all know they are behind in paperwork, so the amount of reimbursements will go up as more applications are approved. Of course the cost of the staff of 5,000 working on processing these payments is not included so the real cost will be even higher.
Schedule to pay IRS 9/3/2009 5:20:00 PM You have up to April 15 to pay last year's taxes, that is 3.5 months. Originally the C4C was to last till October. But the program was too successful and everything got done 3 times faster than originally expected. Backlog was due to too much success, just like the iPhone got sold out in a flash and there was a backlog of orders. Auto Dealers have to put up their own money to buy cars to put in the show room in order to sell them, so how is paying up front money any different? Dealers who had less capital just had to sell less C4C cars, and that is how business works.
60 day terms... 9/3/2009 6:39:00 PM Comment at 5:20:00PM is right on. 60 days is common payment schedule for B2B invoices. What's the fuss all about? Oh, I forgot this is the wacko wingnut forum.
What's the real cost? 9/4/2009 5:53:00 AM We (those of us who actually pay taxes) are spending $2.88 billion directly to the dealers, but how much are the 5000 workers costing us? How many of those workers are government employees? What were they doing before this program? What are they going to be doing after the program ends? What percentage of applications are being denied?
RE: 60 day terms 9/4/2009 9:01:00 AM "Wacko wingnut forum" is putting it nicely..... Don't you know everyone wants everything yesterday???
60 day terms? 9/4/2009 9:32:00 AM Left wingers, one thing you are missing is that many taxpayers are quarterly payments based on projected earnings. If any condition causes earnings to jump, penalties are assessed. You may have 3.5 months to pay but you STILL PAY PENALTIES for being late. (Oh, and if you overpay, you wait for the government to reimburse). But we know you lefties have no clue, you have a union and government to do all your thinking for you. Sheep!
Quarterly payments to IRS. 9/4/2009 12:55:00 PM Yes, what any inconvenience to people who make tons of money. I guess the blogger is part of the exclusive club of rich people whom Bush so much favored. I bet tax loophole accountants already lowered his real tax rate to about 10%.
RE: Quarterly pay... 9/4/2009 1:49:00 PM My wife is one of those paying the estimated tax quoterly. She makes about $12000 a year. I guess the deffinition of "rich people" is getting lower and lower.
Quarterly IRS payments non-issue 9/4/2009 4:44:00 PM Like most working stiffs, I pay withholding tax. Quarterly IRS payments for someone making $12,000 a year are no different from withholding. This is a non issue. Now if you are making millions, then it is a big issue.
Quite the "discussion" here 9/4/2009 5:42:00 PM Seems this "discussion" was about a govt reinbursement vs normal business invoice payment terms to new car dealers. Amazing how people twist it into a whine about quarterly income tax payments. Should I whine about my bi-weekly income tax withholding? Oh the humanity!
Rich People and C4C program 9/5/2009 5:30:00 PM In response to "Quarterly pay" To the administration, I think "rich" is anyone that works! Small businesses all need to make quarterly deposits, win, lose or draw. As I remember the onset of the C4C program, dealers were to be reimbursed "typically" within 10 days of approval. I've never seen one of the actual forms submitted for each of the C4C deals, but I've read about them being overly complex, and of many pages. To me, this looks like it should have been an ideal use for a simple, less than one page affidavit, with electronic submission. andc perhaps a voucher that could be used as part of the payment the dealership makes to the factory for those new cars. Governm,ent Motors and Chrysler could use them toward payments of their debit to the Government. Other manufacturers could use them as cash in their deposits for with holding and they myriad of other taxes they make on a regular basis. Oh yes, and don't forget that most, if not all, government employees are unionized, so I can see a limit as to how much work they can do in a given amount of time. This whole mess has put many dealers in a very tight financial bind.

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