Note: Volkswagen is waiting on some supplier paperwork but it appears that the ID.4s made in Chattanooga, TN will qualify for the full credit, or at least they expect they will soon. This should apply retroactively back to April 18 should they qualify on both battery component and mineral sourcing requirements. ID7? It'll be built in Germany so no credit. TBH, I'm surprised that the US-made BMW, Audi, Rivian, Volvo, Genesis and Mercedes models didn't qualify. However without an accounting of exactly how much of the batteries came from where we won't know how close they are. I really wish the window sticker would be updated to include this information.
@@manuelias86 It's out because it isn't built in N. America. The minimum point of entry is assembly in the USA, Canada or Mexico. The ID.7 for now will be built in Germany.
Yes they did I think one factor is business normally lease and they are very cost aware so without a big discount they would keep buying 14mpg vehicles. I think it could be a plus for a regular buyer if you lease then buy out the lease if the discount is big enough or want something without a credit.
just a small but potentially important edit on the slide at the 5:00 mark -- the AGI requirement can be met either the year you buy the EV, or the year before. For people that changed jobs or got a big promotion in 2023, that can make difference if you can use your 2022 income, instead
They should have phased in the battery sourcing requirements over a longer period. There simply isn't enough capacity right now domestically and it's years away from being adequate.
Great video! I agree that I was really hoping to see some form of status sheet for the manufacturers and how far "ahead of the curve" they are regarding battery sourcing percentages. I'm hoping to get a Blazer EV, but it would be preferable to take a $7,500 coupon in 2024 so I have lower financing without a bigger down payment, but if I'm risking losing the coupon entirely I should buy in 2023.
Tesla Model Y AWD with 279 mile range now priced at $39k after tax credit. That's by far the highest value for money for the most practical car for long-trips.
Manchin really screwed up this bill. Most of these should have started phasing in two years later. Even the assembled in USA part. Overly complicated also! It should have been a rebate not a credit to widen who benefits even if the amount was smaller. And then on top of it all the worse efficiency SUVs get special treatment, WTH!
Retired tax accountant: Doing your taxes via professional or on your own, all you may need is a decent tax prep software. Enter basic data including VIN number, dates of purchase and a few other items, and the software may calculate the rest. There might be online software available now in which you can TEST for tax credit before actually purchasing the vehicle.
There is an additional twist to that Lease, fine print, it doesn’t specifically say lease, it says ,”business” purchase… therefore it has interpreted as lease, because the business purchasing it could be the dealership… therefore, if you own your own business and can purchase the car there, you can qualify for the credit as well.
Hoad a New Jersey Genesis dealer state in writing that $7500 in credit would be given by the leasing company so there’s hope for the GV60 and others of that brand. 9:12
They should have some form to battery passport for EVs that lists all the minerals and sources along with the final assembly. Thanks Alex for clearly explaining this.
That’s the situation I’m in (Ford Escape PHEV). It’s making me consider buying a Kia Niro PHEV instead for about the same price and faster availability. Probably not what the government would hope to encourage with these rules.
A great video and clearly explains the battery mystery behind EV tax credits. Have a question: what’s your assessment with let’s say NJ state proactively ending its tax credits effective 17th April 2023. Who according to you would qualify if EV orders were booked before the above mentioned date but delivery is yet to be done. Appreciate your help.
Is a lease buyout qualify for the used EV tax credit given that the car didn’t originally claimed any tax credits when it was originally leased? No one seems to touch on this topic
Hi EV Buyers Guide. Sorry if you have already answered this question in the comments. I am retired on a fixed income and owed $265 dollars to the IRS for 2022. If I understand you correctly, If I bought a qualifying EV now and still owe only $265 dollars for 2023, I would only get back the $265 dollars and not the $7500 tax credit? Thanks!
Anyone know if you can get a new AND a used tax credit in the same year for qualifying vehicles? Meaning, if you buy a new EV and a used EV after April 2023, can you claim both federal tax credits for 2023?
I will tell you that a lot of EV's on the list will drop off for a few years. The MachE for example is made in Mexico, but much of the battery is sourced in South Korea and China. Ford is also teaming up with CATL for battery production here in the US. Battery composition is what is under attack here not design so we will have to see how that works out. GM is building its own batteries, but I think at least some of the materials are coming from China as well. But the US manufactures have been aware of these rules since the original Build Back Better Bill was proposed 2 years ago, so they have been trying to change their sources to those from the US and South America. Its the European companies that are pissed as next to none of their vehicles are currently eligible nor will be for the foreseeable future. Europe doesn't have access to the minerals so have freely been getting them from Russia and China (even now some European companies are still not compliant with Russian Sanctions AIRBUS). I think VW has said that they will build special packs for the US market eventually, but who knows when that will happen. I know some people won't like this, but this is the Federal Government spending money supporting American jobs so, its a stimulus that works.
The government also has stated goals around environmental improvement, which are contradicted by these PHEV/EV restrictions. Once again, capitalism trumps the health of this orb we all live on. Seems shortsighted.
The whole thing is far too confusing for the general public. Shoot, it's even hard for me to wrap my head around it and I'm actually trying to stay on top of it. I can already picture uninformed salesman making promises that they simply are not educated about. They barley could tell you what color your new vehicle is when they are standing in front of it. This needs to be clearly stated on the window sticker, and a better move would be to set it up with a credit available at the time of sale, or at worst, make it like a "mail in rebate" that I could apply for just after the purchase is final.
Man you nailed it. I think the Democrats want the political capital of offering This tax credit without Truly and fully benefiting Many electric car purchasers.
Can you please do a part 2 video, listing everything we do know about next year; will the tax credit indeed turn to point of purchase, will it be refundable at that point, when will we know which models will and won't qualify for anything for 2024? It would help viewers plan their purchasing decisions
It's nuts that you have to buy your battery from the car manufacturer. What if you're headed by gasoline from the auto dealer. You should be able to purchase car separately and look for a battery in the aftermarket.
Okay real quick. I signed a contract to lock in the $7,500 credit before the inflation reduction act. Do I still get that tax credit when I finally make the purchase this year?
So if I bought a Wrangler 4XE a couple weeks ago, do I get the full $7500 when I file next year or is it cut in half? In other words, do you abide by the set of rules from when you bought or from when you file?
Its understandable that they tightened he restrictions for a battery that only came from us or from countries they like to trade with. What I don’t understand is why leasing allows $7500 tax credit but financing isnt. Its not about the battery restrictions. Is it really about that or something else?
Manufacturing site is the first requirement that must be met. The 2 parts that ultimately determine whether the vehicle will get a tax credit is the battery sourcing and battery mineral sourcing.
Did I miss it, or is the Polestar 2 not on the list of vehicles that did qualify for a credit? Does the Polestar 2 still qualify for some kind of credit?
Is it possible to lease, then quickly buy out the lease for a small fee? That's the only way I'd lease, but I would consider that option to get a credit/discount on one of the cars I want.
It is to force minerals to assembly back to North America, away from Russia and China. Automobile manufacturering as well as other manufacturering is vital to our GDP.
If you won't meet the income requirements in 2023 you can use previous year income to qualify! So if you were not over the limit last year you can still buy the car this year and get the credit.
Funny how if you make too much money, they'll let you wrangle the numbers around to make it work, but if you make too little money, they don't let you add on previous/next years' tax burden to get closer to the full $7500 credit. It's a strangely regressive benefit, given the impact it should have on making EVs more accessible to the everyman. Best I've manged to find is to pull out some money from 401k into a private retirement/investment account instead, and tank the tax hit with the credit. Not completely sold on that one, but it might technically work~
@@MaskedMammal You can use previous year income not matter if you are above or below. However, if you don't owe $7500 or more this year it won't help because it's not refundable.
Lawmakers should have separated out one tax incentive to consumers who buy an EV, and a separate tax incentive to manufacturers who use minerals, components, and assembling from the USA or related countries. Instead, lawmakers threw this all into one big group of tax incentives, all aimed at consumers (who could easily buy the wrong car), and then made it as clear as mud.
This makes total sense .. Now a consumer is forced to buy from a small pool of EVs due to tax incentive and manufacturers are forced to comply to make their product compliant for end customer to get the rebate.. They should have divided the tax incentive like 3500 for every EV and 7500 if EV happens to be North American
@@abhi4ify If I were trying to get a manufacturer to make its vehicles in the USA from American-sourced parts, I think it would make more sense to go to the manufacturer to do that. But that's just me. I guess I am too direct.
Car and Driver has more info on that. VW is waiting on final certification from a supplier before they can attest to the Treasury Department that the ID.4 is fully compliant.
So let me get this straight do they give you the $7500 off at the point of sale? Or is it something that comes back in your taxes a year from now? So far it’s looking like the IRA is doing nothing for the average buyer. But, he is doing a lot for the auto makers. That are still charging $60,000 per vehicle.
It’s a tax credit on your taxes a year from now provided you meet the income requirements and tax liability. It will eventually be POS supposedly but that’s still a few years off
For 2023, the credit would not come off the vehicle's purchase price at the point of sale, but you (or your financial advisor) could always run an estimate of what your 2023 tax liability will be and, assuming you have the requisite tax liability, submit an updated W-4 to your employer reducing the amount of federal income tax being withheld from your paychecks remaining in 2023 to offset the credit you expect to be able to take on your 2023 return when you file it in 2024.
@@DMDBSJD not if you are leasing and the manufacturer passes along the credit on a new EV. Buying a used one you will have haven't have tax liability amongst other thjngs.
@@normt430 You are correct and apologies. I should have made it clear that I was discussing instances of purchasers of new vehicles (and not lessees) when I referenced "purchase price".
Owing money and tax liability are two completely different things. Owing just means you didn’t withhold enough out of your paycheck the previous year and now you owe. You can have a tax liability of 7500+ and still not owe or get a refund if you withhold enough. People confuse this all the time.
This is totally nuts. it discriminates against lower-income people Encourages large battery purchases which is inconsistent with the notion of reducing pollution. The Democrats are hanging their hat on this it's going to hurt their vote. The only good thing is it might encourage foreign me Evie manufacturers to cut Prices to be competitive
No one cares and very few people are going to vote based a niche tax credit. It is not a refundable tax credit, so it is NOT taking from the poor. You get a credit for taxes YOU pay, if you don’t pay more > 7500 in taxes, you get NO benefit. The biggest beneficiary is Tesla and last time I checked Mr. Elon is no Democrat. So yeah, your arguments are don’t add up. The people likely to vote Democrat are not going to change their mind based on this.
They’re going to be giving these things away in 3 years. Car companies are making a lot of them and people aren’t buying them. …then, of course, bailouts will follow.
The tax credit is smoke and mirrors. As it raises and lowers so do the prices from auto makers and dealers. Also, if going green and saving the planet is the ultimate goal, then why does it matter where the vehicle/battery comes from?
Don’t get fooled by the tax credit by auto dealer. There is no money or gov check next yr. This is you don’t owe up to 7,500 that you did pay last yr. And to get this full amount you need to make 180 thousand a yr, but if you did get this amount income disqualified you from the low income credit. The right way was you buy a car and dealer and you turn that in and you collect the 7000 you payed last yr that refunded back then it’s real money back The bill was written to fool many to buying. Saying you got 7 k saving. Nope they just gave a fake higher 7 k their cost , and subtract it to show you save 7 k. The tax credit is called Non refundable. That an accounting word. That you get credit only on what you owe. So you tax saving it likely 150 buck. But you brought a 60 k ev car thinking you save 7,500. Sorry but you got conned . The 2x higher insurance and you likely stuck with a 600-1,300 monthly payment. And have fun road charging waiting in line .
The reason why this tax credit is for the yr end of take possession on the ev. Not from last year tax you payed and get the right amount check amount back to used. Is this way end of year this let the dealer off the hook if the customer says he didn’t get a tax refund of 7,500 he think he getting back next year . Dealer says that was 8 month ago we gave you that 7,500 credit . (They didn’t) That your problem.
What? Advise to think hard, do you owe thousands in back taxes? This year, Before you even think of getting some of that tax credit for a new e.v. Or you find out next year You pay taxes instead. It’s isn’t free ev money. Are you thinking this is a tax offset you can write in? No, this tax credit is only for the rich making about 180 k to owe 7,500 in taxes to not pay it by buying a new e.v. Got it?
The hidden word is non refundable. The credit is nonrefundable; it can lower your tax bill to zero, but it won’t result in a refund. Goggle that accountant word. It goes back credit is equal to taxes you owe and not more. Who owe 7,500 in taxes?
Good, this should’ve only applied to EVs built in the US with material sources from the US, this tax credit shouldn’t apply to plugin hybrids or foreign-built EVs, so no more free rides from the US federal taxpayers, we still have plenty of states, counties, and cities giving their taxpayers money too billion dollar car companies to build plants here, why, build here or get taxed, American love taking care of other countries at the expense of the US
If it is a partnership or S-corp. IRS 3800: Partnerships and S corporations must always complete the source credit form. All other filers whose only source for a credit listed in Form 3800, Part III, is from a partnership, S corporation, estate, trust, or cooperative can report the credit directly on Form 3800. The following exceptions apply.
@@normt430 Tesla has been net profitable since 2019 and they've always been gross-profit positive since 2010. ZEV credits applied to all automakers equally. It's not Tesla's fault that other automakers dragged their feet in reducing their emissions and ended up buying credits from Tesla as a penalty for poisoning kids with NOx and PM pollution from their tail pipes.
Tax credits are theft - no one should take them. I am considering buying a new car - who here can justify my taking $10,000 in taxes from poorer families so I can afford a new model 3 .. Somone on convince me this is justified and I'll buy one. Go on someone .. anyone give me a full justification.. I can imagine taking $1000 from 10 poorer families in person - but maybe if I get it via the govenment its OK? Tell me why.
@@gregkramer5588 Every EV they make is selling, credits or not, due to limited availability. No need to give away tax dollars which artificially increases demand even more. At least making the list of eligible vehicles smaller cuts down on the waste. They really should be incentivizing the purchase of smaller, cheaper EVs (like the Bolt), not luxury ones.
@@pasad335 It has a broader impact than just current buyers. It is a portectionist policy that is aimed at having the US catch up to Europe and China also. (Of course we will not catch up but it should help. I would change it from the current state for sure. It should max out at $6k and be available as a rebate not just a credit. There should be no extra dollar cap for SUVs, it should be $60k max not $80k. In regards to demand there are EVs available now for immediate delivery unlike last year. I think the Bolt is a great car also and all the car many people need. I wish they had a fast charging version of it though.
The faster we don't need these EV Tax Credits, the better. We need Capitalism to push the transition rather than these "incentives" that have a lot of limitations now.
@@junehanzawa5165 aside from inner city pollution there is a growing threat outside of North America that would consume auto manufacturing here by decade's end.
@@normt430 correct. That's why we need to invest and incentivize the automanufaturing of now, not the past. Meaning EV manufacturing, NOT ice. Let's insentivise EV production, not producing vehicles that will be the past, like you said, by the decades end. That's why it's so important that all those new giga-factories for EVs are being built now in America. So let's stop incetivising the past and insentivise the now and future.
![BLACK BAG - Official Trailer [HD] - Only in Theaters March 14](http://i.ytimg.com/vi/Du0Xp8WX_7I/mqdefault.jpg)
Note: Volkswagen is waiting on some supplier paperwork but it appears that the ID.4s made in Chattanooga, TN will qualify for the full credit, or at least they expect they will soon. This should apply retroactively back to April 18 should they qualify on both battery component and mineral sourcing requirements. ID7? It'll be built in Germany so no credit.
TBH, I'm surprised that the US-made BMW, Audi, Rivian, Volvo, Genesis and Mercedes models didn't qualify. However without an accounting of exactly how much of the batteries came from where we won't know how close they are. I really wish the window sticker would be updated to include this information.
Me too, especially with the ID.4! I figured it would at least get half as it's battery pack is made by a Korean company in the US.
@@godofdun Yea so ID.4 goes to zero?
@@darrenorange2982 Seems like it, bummer.
So the new ID7 is also out?
@@manuelias86 It's out because it isn't built in N. America. The minimum point of entry is assembly in the USA, Canada or Mexico. The ID.7 for now will be built in Germany.
It seems like they made it harder for the consumer to get tax credits while the big leasing corps still get them? Seems backwards.
Yes they did
I think one factor is business normally lease and they are very cost aware so without a big discount they would keep buying 14mpg vehicles.
I think it could be a plus for a regular buyer if you lease then buy out the lease if the discount is big enough or want something without a credit.
Alex missed used EV/PHEV tax credit under $25,000.
The good Ole Republican party ruins every good discount for the consumer. They put all this mess in the bills to weaken them.
Because of legalized bribing (lobbying)
I grew up gasoline, gasoline all the way. Who needs tax credit
just a small but potentially important edit on the slide at the 5:00 mark -- the AGI requirement can be met either the year you buy the EV, or the year before. For people that changed jobs or got a big promotion in 2023, that can make difference if you can use your 2022 income, instead
Great job Alex . You spelled it out better than anyone. We know who to watch for the best car reviews and other things
They should have phased in the battery sourcing requirements over a longer period. There simply isn't enough capacity right now domestically and it's years away from being adequate.
Great video! I agree that I was really hoping to see some form of status sheet for the manufacturers and how far "ahead of the curve" they are regarding battery sourcing percentages. I'm hoping to get a Blazer EV, but it would be preferable to take a $7,500 coupon in 2024 so I have lower financing without a bigger down payment, but if I'm risking losing the coupon entirely I should buy in 2023.
I wonder how many people qualify for the tax credit to begin with. With all the criteria required, it seems very few would.
Quite a few would. I would personally increase what I get on my checks through out the year and I would definitely owe tax.
Tesla Model Y AWD with 279 mile range now priced at $39k after tax credit. That's by far the highest value for money for the most practical car for long-trips.
Isn't Tesla unreliable and poorly supported
@@paulwitmer7138 Tesla has the highest NPS (net promoter score) among all automakers. Owners love it, media spreads lies for clicks.
Manchin really screwed up this bill. Most of these should have started phasing in two years later. Even the assembled in USA part. Overly complicated also! It should have been a rebate not a credit to widen who benefits even if the amount was smaller. And then on top of it all the worse efficiency SUVs get special treatment, WTH!
I think they are giving incentives for the bigger vehicles because any improvement in MPG makes a big difference.
@@ralanham76 They should not get an advantage over a more efficient vehicle IMO. I think the incentive should not go away just no special treatment.
Manchin didn’t even want an EV tax credit in the first place. It was this or nothing
Retired tax accountant: Doing your taxes via professional or on your own, all you may need is a decent tax prep software. Enter basic data including VIN number, dates of purchase and a few other items, and the software may calculate the rest. There might be online software available now in which you can TEST for tax credit before actually purchasing the vehicle.
Do I get the 7500 if I lease a model y after 4/18?
Great Video!
Question: Are battery "mineral" and "component" requirements need to be met both or either one?
Just leased a Hyundai Ioniq 5 and received $7,500 credit in lease calculation.
There is an additional twist to that Lease, fine print, it doesn’t specifically say lease, it says ,”business” purchase… therefore it has interpreted as lease, because the business purchasing it could be the dealership… therefore, if you own your own business and can purchase the car there, you can qualify for the credit as well.
Hoad a New Jersey Genesis dealer state in writing that $7500 in credit would be given by the leasing company so there’s hope for the GV60 and others of that brand. 9:12
Does my Model 3 Long Range purchased new last June qualify? 🙃
They should have some form to battery passport for EVs that lists all the minerals and sources along with the final assembly. Thanks Alex for clearly explaining this.
OEMs are already required to disclose the material sourcing if they want to qualify for the second half of the tax credit.
Totally BS for those who ordered last year a vehicle under the old rules and not get grandfathered in for delivery after 4/18.
That’s the situation I’m in (Ford Escape PHEV). It’s making me consider buying a Kia Niro PHEV instead for about the same price and faster availability. Probably not what the government would hope to encourage with these rules.
@@mavsguy842 niro is Arguably the better car anyway
Yes, you have to have paper work showing delivering.
Great video, do you think the $25,000 cut-off for used EVs might go up to say 30,000 in 2024? Thank you.
A great video and clearly explains the battery mystery behind EV tax credits. Have a question: what’s your assessment with let’s say NJ state proactively ending its tax credits effective 17th April 2023. Who according to you would qualify if EV orders were booked before the above mentioned date but delivery is yet to be done. Appreciate your help.
Is a lease buyout qualify for the used EV tax credit given that the car didn’t originally claimed any tax credits when it was originally leased? No one seems to touch on this topic
This explains why there's a battery plant coming soon to windsor ont.
Hi Alex if I am getting a refund this year, will I receive a refund + 7500 next year?
Hi EV Buyers Guide. Sorry if you have already answered this question in the comments. I am retired on a fixed income and owed $265 dollars to the IRS for 2022. If I understand you correctly, If I bought a qualifying EV now and still owe only $265 dollars for 2023, I would only get back the $265 dollars and not the $7500 tax credit? Thanks!
Anyone know if you can get a new AND a used tax credit in the same year for qualifying vehicles? Meaning, if you buy a new EV and a used EV after April 2023, can you claim both federal tax credits for 2023?
I will tell you that a lot of EV's on the list will drop off for a few years. The MachE for example is made in Mexico, but much of the battery is sourced in South Korea and China. Ford is also teaming up with CATL for battery production here in the US. Battery composition is what is under attack here not design so we will have to see how that works out. GM is building its own batteries, but I think at least some of the materials are coming from China as well. But the US manufactures have been aware of these rules since the original Build Back Better Bill was proposed 2 years ago, so they have been trying to change their sources to those from the US and South America. Its the European companies that are pissed as next to none of their vehicles are currently eligible nor will be for the foreseeable future. Europe doesn't have access to the minerals so have freely been getting them from Russia and China (even now some European companies are still not compliant with Russian Sanctions AIRBUS). I think VW has said that they will build special packs for the US market eventually, but who knows when that will happen.
I know some people won't like this, but this is the Federal Government spending money supporting American jobs so, its a stimulus that works.
The government also has stated goals around environmental improvement, which are contradicted by these PHEV/EV restrictions. Once again, capitalism trumps the health of this orb we all live on. Seems shortsighted.
The whole thing is far too confusing for the general public. Shoot, it's even hard for me to wrap my head around it and I'm actually trying to stay on top of it. I can already picture uninformed salesman making promises that they simply are not educated about. They barley could tell you what color your new vehicle is when they are standing in front of it.
This needs to be clearly stated on the window sticker, and a better move would be to set it up with a credit available at the time of sale, or at worst, make it like a "mail in rebate" that I could apply for just after the purchase is final.
Man you nailed it. I think the Democrats want the political capital of offering
This tax credit without
Truly and fully benefiting
Many electric car purchasers.
Thank you for this very concise update.
Great video and I agree on knowing how well does a vehicle comply or not to this program.
Great breakdown. Thank you!
Can you please do a part 2 video, listing everything we do know about next year; will the tax credit indeed turn to point of purchase, will it be refundable at that point, when will we know which models will and won't qualify for anything for 2024? It would help viewers plan their purchasing decisions
It's nuts that you have to buy your battery from the car manufacturer. What if you're headed by gasoline from the auto dealer. You should be able to purchase car separately and look for a battery in the aftermarket.
Okay real quick. I signed a contract to lock in the $7,500 credit before the inflation reduction act.
Do I still get that tax credit when I finally make the purchase this year?
It will Now depend on what car and where it gets it’s parts! Won’t matter when you signed that deal.
You have to have paper work stating thr car was already delivered.
So if I bought a Wrangler 4XE a couple weeks ago, do I get the full $7500 when I file next year or is it cut in half? In other words, do you abide by the set of rules from when you bought or from when you file?
When you bought it. If you got it before April 18 youre OK
Its when you buy. My state just brought back their EV tax credits, but because they didn't kick in until after I bought it, I am ineligible.
Weird that one Lincoln PHEV model qualifies for full $7500 and the other Lincoln PHEV only qualifies for half.
Its understandable that they tightened he restrictions for a battery that only came from us or from countries they like to trade with. What I don’t understand is why leasing allows $7500 tax credit but financing isnt. Its not about the battery restrictions. Is it really about that or something else?
Unintended consequences of legislation that wasn’t written as carefully as maybe they thought it was
Not really fair to Koreans who made decisions before rules changed last year.
I bought a Niro EV recently and I like it better than my tesla model 3 2019
Your decisions are your problem.
Yeah the law was unfair as it didn't allow grandfathering existing production.
I’m pretty sure they made the law to favor the American brands
Unfair to a lot of manufacturers, but Hyundai/Kia are supposed to he building a new US factory
Will the Kia EV 9 qualify since it'll be built in Georgia for the 2024 models?
Manufacturing site is the first requirement that must be met. The 2 parts that ultimately determine whether the vehicle will get a tax credit is the battery sourcing and battery mineral sourcing.
Did I miss it, or is the Polestar 2 not on the list of vehicles that did qualify for a credit? Does the Polestar 2 still qualify for some kind of credit?
Probably not, it's a Chinese company and their vehicles are made in China.
It’s not
I believe so as does Volvo if you lease.
Is it possible to lease, then quickly buy out the lease for a small fee? That's the only way I'd lease, but I would consider that option to get a credit/discount on one of the cars I want.
Nope it has to be purchased new from a dealer. You can’t lease then buy it out to get the credit
This is ridiculous, this tax credit process makes no sense, to complicated and is going to push EV buyers away. Sad
I think that’s the point. Some legislators are so against EVs that they want to complicate the process to turn off buyers.
Wait until 2024. The tax credit comes off at the point of sale. So it’s easier to get a loan.
It is to force minerals to assembly back to North America, away from Russia and China. Automobile manufacturering as well as other manufacturering is vital to our GDP.
so if i only report low income, i wouldn't get the credit. so its not worth it?
Thanks for the details, can you take some time and go over each State rebate and how they work, specifically Illinois? :)
i paid almost 5k in taxes this year . I made 74k income. do you think the ev tax crdit will benefit me?
If you won't meet the income requirements in 2023 you can use previous year income to qualify! So if you were not over the limit last year you can still buy the car this year and get the credit.
Funny how if you make too much money, they'll let you wrangle the numbers around to make it work, but if you make too little money, they don't let you add on previous/next years' tax burden to get closer to the full $7500 credit. It's a strangely regressive benefit, given the impact it should have on making EVs more accessible to the everyman.
Best I've manged to find is to pull out some money from 401k into a private retirement/investment account instead, and tank the tax hit with the credit. Not completely sold on that one, but it might technically work~
@@MaskedMammal You can use previous year income not matter if you are above or below. However, if you don't owe $7500 or more this year it won't help because it's not refundable.
What does this mean?
How can you change your tax liability?
@@ralanham76 With anything that counts as taxable income.
Seriously!? If so, that’s a game changer for me! Can you provide a source?
HEV's?
Hybrid Electric Vehicles are the same as Plug-in Hybrid Electric Vehicles PHEV
@@ralanham76 "Actually", PHEVs can get power from the wall. HEVs cannot; they get all their power from their onboard motor and/or regenetive braking.
@@getoffamylan6844 they have started to merge the terms
I picked up my new Model 3 base RWD on 4/17/23😅
This is why we need something at POS
No. This is program just shouldn’t exist.
Lawmakers should have separated out one tax incentive to consumers who buy an EV, and a separate tax incentive to manufacturers who use minerals, components, and assembling from the USA or related countries. Instead, lawmakers threw this all into one big group of tax incentives, all aimed at consumers (who could easily buy the wrong car), and then made it as clear as mud.
This makes total sense .. Now a consumer is forced to buy from a small pool of EVs due to tax incentive and manufacturers are forced to comply to make their product compliant for end customer to get the rebate.. They should have divided the tax incentive like 3500 for every EV and 7500 if EV happens to be North American
@@abhi4ify If I were trying to get a manufacturer to make its vehicles in the USA from American-sourced parts, I think it would make more sense to go to the manufacturer to do that. But that's just me. I guess I am too direct.
How does Hyundai get a credit, when its literally sister company (may as well be identical twin) - Kia - does not?
When is the tax credit turning into the refund?
You don't taxes?
Wasn't the battery aspect supposed to be only making up a HALF of the $7500, with the $3750 awarded to any North American-made EV?
I think i heard US-built ID.4 gets full $7500 for now. Not sure if you can confirm?
For the next few hours only. Midnight tomorrow (April 18) it will be gone for the ID.4.
Car and Driver has more info on that. VW is waiting on final certification from a supplier before they can attest to the Treasury Department that the ID.4 is fully compliant.
What are the rules about married couples? Can my wife and I buy two new EVs and get the full 7500 per car?
Hell yeah maybe it's time to buy a Bolt.
Could you lease an EV and get the $7500 tax credit, and then buy it used off lease and (possibly) get another $4000 tax credit at that time?
Nope the bill specifically says one credit per car per customer
So let me get this straight do they give you the $7500 off at the point of sale? Or is it something that comes back in your taxes a year from now? So far it’s looking like the IRA is doing nothing for the average buyer. But, he is doing a lot for the auto makers. That are still charging $60,000 per vehicle.
It’s a tax credit on your taxes a year from now provided you meet the income requirements and tax liability. It will eventually be POS supposedly but that’s still a few years off
Only when leasing from a manufacturer who will pass it credit along.
For 2023, the credit would not come off the vehicle's purchase price at the point of sale, but you (or your financial advisor) could always run an estimate of what your 2023 tax liability will be and, assuming you have the requisite tax liability, submit an updated W-4 to your employer reducing the amount of federal income tax being withheld from your paychecks remaining in 2023 to offset the credit you expect to be able to take on your 2023 return when you file it in 2024.
@@DMDBSJD not if you are leasing and the manufacturer passes along the credit on a new EV. Buying a used one you will have haven't have tax liability amongst other thjngs.
@@normt430 You are correct and apologies. I should have made it clear that I was discussing instances of purchasers of new vehicles (and not lessees) when I referenced "purchase price".
Asian car makers got another hit under the waterline along with supply chain and production trouble...
So did the Germans…
@@Dactylonian Yep.
If you buy an ineligible vehicle now, which is certified 2 months from now, will you qualify for the tax credit or not?
Why, as a taxpyer, should I have to pay for someone's EV since I don't want one.
So, if you don't owe money on your return the credit means nothing.
Owing money and tax liability are two completely different things. Owing just means you didn’t withhold enough out of your paycheck the previous year and now you owe. You can have a tax liability of 7500+ and still not owe or get a refund if you withhold enough. People confuse this all the time.
Unless you lease and the auto finance arm can pass along the credit.
I dont get it how it works. What I care about, how much am I going to pay, let's say for a Jeep Wrangler PHVE.
Well this has literally moved me away from buying or leasing an PHEV
How about used?
This is totally nuts. it discriminates against lower-income people
Encourages large battery purchases which is inconsistent with the notion of reducing pollution. The Democrats are hanging their hat on this it's going to hurt their vote. The only good thing is it might encourage foreign me Evie manufacturers to cut
Prices to be competitive
No one cares and very few people are going to vote based a niche tax credit. It is not a refundable tax credit, so it is NOT taking from the poor. You get a credit for taxes YOU pay, if you don’t pay more > 7500 in taxes, you get NO benefit. The biggest beneficiary is Tesla and last time I checked Mr. Elon is no Democrat. So yeah, your arguments are don’t add up. The people likely to vote Democrat are not going to change their mind based on this.
Tax credit are joke
So are taxes!
They’re going to be giving these things away in 3 years.
Car companies are making a lot of them and people aren’t buying them.
…then, of course, bailouts will follow.
So, they force taxpayers to help rich people buy EVs of which many do not exist. GOT IT.
Except for buying less than $25k used EV/PHEV's that is two years old and your under thr income limits.
It really seems unfair that leasing companies can get a tax credit on a vehicle that I, an actual citizen, cannot get.
Why? The company bought and the car and you didn’t
You can lease the car you want and probably get the credit in the contract.
@@SaltyProductionsHD because if I buy the car I cannot get the credit, but if the company buys the car, they can get the credit.
@@mavsguy842 with a lease that you cannot buyout in the shorter it brings you back for another in three years or so.
The tax credit is smoke and mirrors. As it raises and lowers so do the prices from auto makers and dealers. Also, if going green and saving the planet is the ultimate goal, then why does it matter where the vehicle/battery comes from?
Joe manchin didn’t want EV credits in the bill in the first place this was the compromise that had to be made to get the bill passed
Don’t get fooled by the tax credit by auto dealer. There is no money or gov check next yr. This is you don’t owe up to 7,500 that you did pay last yr. And to get this full amount you need to make 180 thousand a yr, but if you did get this amount income disqualified you from the low income credit. The right way was you buy a car and dealer and you turn that in and you collect the 7000 you payed last yr that refunded back then it’s real money back
The bill was written to fool many to buying. Saying you got 7 k saving. Nope they just gave a fake higher 7 k their cost , and subtract it to show you save 7 k. The tax credit is called
Non refundable. That an accounting word. That you get credit only on what you owe. So you tax saving it likely 150 buck. But you brought a 60 k ev car thinking you save 7,500. Sorry but you got conned . The 2x higher insurance and you likely stuck with a 600-1,300 monthly payment. And have fun road charging waiting in line .
The reason why this tax credit is for the yr end of take possession on the ev. Not from last year tax you payed and get the right amount check amount back to used. Is this way end of year this let the dealer off the hook if the customer says he didn’t get a tax refund of 7,500 he think he getting back next year . Dealer says that was 8 month ago we gave you that 7,500 credit . (They didn’t) That your problem.
I wouldn't call this the most sound tax advice. -Travis
What? Advise to think hard, do you owe thousands in back taxes? This year, Before you even think of getting some of that tax credit for a new e.v. Or you find out next year
You pay taxes instead. It’s isn’t free ev money. Are you thinking this is a tax offset you can write in? No, this tax credit is only for the rich making about 180 k to owe 7,500 in taxes to not pay it by buying a new e.v. Got it?
The hidden word is non refundable.
The credit is nonrefundable; it can lower your tax bill to zero, but it won’t result in a refund.
Goggle that accountant word. It goes back credit is equal to taxes you owe and not more. Who owe 7,500 in taxes?
Hopefully the next administration will throw out all this nonsense.
Good, this should’ve only applied to EVs built in the US with material sources from the US, this tax credit shouldn’t apply to plugin hybrids or foreign-built EVs, so no more free rides from the US federal taxpayers, we still have plenty of states, counties, and cities giving their taxpayers money too billion dollar car companies to build plants here, why, build here or get taxed, American love taking care of other countries at the expense of the US
Politicians gave away the working middle class to Asia. This is the only way to get it back
Can you get the credit if you're buying the EV for your business?
If it is a partnership or S-corp.
IRS 3800:
Partnerships and S corporations must always complete the source credit form. All other filers whose only source for a credit listed in Form 3800, Part III, is from a partnership, S corporation, estate, trust, or cooperative can report the credit directly on Form 3800. The following exceptions apply.
None of this should be getting subsidized, especially Tesla. Should never have been subsidized since Day 1.
Tesla is been on ZEV carbon credits for two decades and just recently made profit!
Why single out Tesla? Every auto company took advantage of those tax credits. The bill for previous tax credit was lobbied for by GM.
@@mydutube even with ZEV credits of billions of dollars Tesla has only recently been profitable selling EV's.
@@normt430 Tesla has been net profitable since 2019 and they've always been gross-profit positive since 2010. ZEV credits applied to all automakers equally. It's not Tesla's fault that other automakers dragged their feet in reducing their emissions and ended up buying credits from Tesla as a penalty for poisoning kids with NOx and PM pollution from their tail pipes.
Tax credits are theft - no one should take them. I am considering buying a new car - who here can justify my taking $10,000 in taxes from poorer families so I can afford a new model 3 .. Somone on convince me this is justified and I'll buy one. Go on someone .. anyone give me a full justification.. I can imagine taking $1000 from 10 poorer families in person - but maybe if I get it via the govenment its OK? Tell me why.
There should be no tax credits at all.
I am curious, are you concerned about climate change? Or let the kids and future generations pay the price?
@@gregkramer5588 The climate is always changing there's nothing we can do about it. The oceans rise and fall nothing we can do about it.
@Richard Button The data humanity has collected completely disagrees with you.
@@gregkramer5588 Every EV they make is selling, credits or not, due to limited availability. No need to give away tax dollars which artificially increases demand even more. At least making the list of eligible vehicles smaller cuts down on the waste. They really should be incentivizing the purchase of smaller, cheaper EVs (like the Bolt), not luxury ones.
@@pasad335 It has a broader impact than just current buyers. It is a portectionist policy that is aimed at having the US catch up to Europe and China also. (Of course we will not catch up but it should help. I would change it from the current state for sure. It should max out at $6k and be available as a rebate not just a credit. There should be no extra dollar cap for SUVs, it should be $60k max not $80k. In regards to demand there are EVs available now for immediate delivery unlike last year. I think the Bolt is a great car also and all the car many people need. I wish they had a fast charging version of it though.
LOL - - you have to be kidding - - -leave it to the government to require you to jump thru so many hoops - - - the rebate program is dead !
The faster we don't need these EV Tax Credits, the better. We need Capitalism to push the transition rather than these "incentives" that have a lot of limitations now.
Only junk cars now qualify
The fact that any vehicles that uses gas is eligible is ridiculous. Why are we further incetivising fossil fuels?
Your gasoline is already subsidized.
@@normt430 correct. That's my point. Why sudsidise it further?
@@junehanzawa5165 aside from inner city pollution there is a growing threat outside of North America that would consume auto manufacturing here by decade's end.
@@normt430 correct. That's why we need to invest and incentivize the automanufaturing of now, not the past. Meaning EV manufacturing, NOT ice. Let's insentivise EV production, not producing vehicles that will be the past, like you said, by the decades end. That's why it's so important that all those new giga-factories for EVs are being built now in America. So let's stop incetivising the past and insentivise the now and future.
@@junehanzawa5165 you vote for or against politicians is one place aside from purchasing power.