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EV Tax Credit change

1266 Views 8 Replies 5 Participants Last post by SHale, 10 mo ago

mxc0bbn

Discussion Starter · 10 mo ago

So, the bill that just passed the senate. The "Inflation Reduction Act" will make the EV Tax credit instantaneous.

Senate improves EV tax credit in largest climate bill ever

The new electric car tax credit is easier to claim and extended to 2032 to US-built EVs, along with a new $4,000 credit on used EVs.

electrek.co

From the article:
"Also, the credit can be applied upfront at the point of sale if purchased from a dealer, rather than needing to file for it on your taxes in the following April"

And it also makes a ton of what I wrote in my last post completely irrelevant...LOL.

The tax credit is no longer a tax credit, but an actual discount on the car at the point of sale. So, if you got that VF9 fully loaded (lets guess ~$68,000), and you have the 5K discount, you will now pay (68,000 - 5,000 - 7,500)...so $55,500 at time of purchase.

The only caveat though is that you have to make less than $150,000 a year as an individual, or $300,000 if married...

When I read that I thought: Wow, first time being married saved me money...

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ZPower

· #2 · 10 mo ago

But would VinFast still qualify? Wouldn't the old credit stop functioning the moment Biden signs the bill? VinFast cars initially won't be assembled in US.

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s7davis

· #3 · 10 mo ago

ZPower said:
But would VinFast still qualify? Wouldn't the old credit stop functioning the moment Biden signs the bill? VinFast cars initially won't be assembled in US.

Yes at the moment until VinFast NC plant opens they will not qualify. They will need to make firm purchase order agreements for people to be grandfathered into the old tax credit of $7500 for first 200k vehicles. So Vinfast needs to get those emails out to make order agreements out ASAP or their will be no tax credit until 2024 and then it is only 3750 for car manufacturing the rest depends on where the Batteries minerals are mined and manufactured.

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mxc0bbn

Discussion Starter · #4 · 10 mo ago

ZPower said:
But would VinFast still qualify? Wouldn't the old credit stop functioning the moment Biden signs the bill? VinFast cars initially won't be assembled in US.

Actually that is a great point that I hadn't thought of. Most the other cars we normally attribute this Tax Credit/Discount to are all manufactured in the US, but yeah, Vinfast will likely not qualify for this credit in the same way.

Good catch...and good explanation @s7davis

on edit: originally wrote 'All', but really should have said most since Hyundai, KIA and some others might also lose this credit.

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s7davis

· #5 · 10 mo ago (Edited)

mxc0bbn said:
Actually that is a great point that I hadn't thought of. Most the other cars we normally attribute this Tax Credit/Discount to are all manufactured in the US, but yeah, Vinfast will likely not qualify for this credit in the same way.

Good catch...and good explanation @s7davis

on edit: originally wrote 'All', but really should have said most since Hyundai, KIA and some others might also lose this credit.

I think as it stands right now only 11 EVs sold in the USA will qualify for at least half the credit and maybe 1 or 2 will qualify for full credit.

So to qualify cars can not be more than $55k and SUV/Trucks no higher than $80k.
I believe the ones that will qualify for some or all credit will be the following and I am sure I will miss a few

Ford Mach-E
Ford Lightning
Tesla Model 3
Tesla Model Y
Chevy Bolt
Chevy Blazer Cheap model
Chevy Equinox Probably all
Nissan Leaf I think it is built in US or USFT
Audi (I think)
Rivian (if they nerf software on the Truck to lower its price
Rivian SUV (nerf software to lower range and power to lower its price)
Lucid (only if they nerf software severely to lower it to a base $55k car)
Vinfast (only will qualify once NC Factory is built and operational)
Fisker Pear (it will be built in OH I think at Foxconn FActory. Pear not expected until 2024 or 2025) [Fisker may move Ocean manufacturing to Foxconn so it will get credits as well.
Fisker Ocean (will not qualify as it is built in Austria)

Now remember these credits are only for a decade. They will expire in 2032 no matter how many vehicles are sold. Technically they are not credits is a POS Rebate that will be added to any and all vehicle purchase agreements which then will enable car companies to raise the prices of the vehicles by that amount.

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Praxx62

· #6 · 10 mo ago

s7davis said:
Yes at the moment until VinFast NC plant opens they will not qualify. They will need to make firm purchase order agreements for people to be grandfathered into the old tax credit of $7500 for first 200k vehicles. So Vinfast needs to get those emails out to make order agreements out ASAP or their will be no tax credit until 2024 and then it is only 3750 for car manufacturing the rest depends on where the Batteries minerals are mined and manufactured.

Yes that’s true I just heard that fisher just Email all of the reservation holders to order There Fisher ocean now and lock in the price and they will be grandfathered in for next year delivery Vinfast we could do the same

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mxc0bbn

Discussion Starter · #7 · 10 mo ago

s7davis said:
which then will enable car companies to raise the prices of the vehicles by that amount.

Oh God, I completely forgot about this. They always find a way to screw consumers. You can totally bet they will raise prices, but it will have to be in 2-3 years because right now it would be seen as too obvious if all of a sudden their prices go up by 7k from one year to the next.

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s7davis

· #8 · 10 mo ago

Credits for New Electric Vehicles Purchased in 2022 or Before | Internal Revenue Service

If you bought or leased a new, qualified plug-in electric vehicle (EV) in 2022 or before, you may be eligible for a clean vehicle tax credit up to $7,500 under IRC 30D.

www.irs.gov