Aug. 7--When UW-Madison business professor Dan Anderson bought a Toyota Prius hybrid car a year ago, he thought the higher purchase price would be offset by a new federal hybrid tax credit.

But Anderson was victimized by the alternative minimum tax, which reduced his tax credit to almost nothing.

"I would have bought it anyway," Anderson said, "but I definitely realized they're charging more. Part of my rationale was I was going to get $3,150 back."

The alternative minimum tax is designed to ensure that corporations and high-income individuals pay some kind of tax regardless of deductions. Hybrid cars such as the Prius save fuel by running on batteries at certain speeds, minimizing use of the gasoline engine.

The federal hybrid tax credit, enacted last year as part of President Bush's energy bill, replaced a $2,000 income tax deduction.

Although the credit seemed like a better deal, it wasn't for some taxpayers, according to Bradley Berman, editor of HybridCars.com.

"Surprisingly, for taxpayers who take a lot of deductions or use the alternative minimum tax, the previous tax deduction, which bit the dust in 2005, was more valuable," Berman writes on his Web site.

The hybrid tax credit won't reduce the alternative minimum tax and is taken last if a taxpayer is eligible for multiple credits.

The first 60,000 buyers of various hybrid brands are eligible for the credit. Buyers have until Sept. 30 to buy a Toyota or Lexus hybrid and qualify for the full credit. The credit for Toyota will be cut in half on Oct. 1 and fall to 25 percent after two quarters. It will expire on Oct. 1, 2007.

Buyers of other hybrid brands also are eligible for credits, including Ford, Honda, Mercury and upcoming models from Chevrolet, Nissan and Saturn.

Ben Lancaster, sales manager at Jon Lancaster Toyota, 3501 Lancaster Drive, said sales people tell customers about the credit but recommend they contact their individual tax advisers about their particular circumstances.

"I think a lot of people right now are conscious they can get it," he said. "I don't think you're going to see a radical decline in hybrid sales after Sept. 30, when the tax credit gets cut in half."