Treasury releases guidance for new EV tax credits

[chl]

Their Market Adjustments aren’t working for these Trucks anymore. Ford will either throw more incentive money or just stop sending that dealer trucks. I mean some of these dealers are smoking some good stuff

Their Market Adjustments aren’t working for these Trucks anymore. Ford will either throw more incentive money or just stop sending that dealer trucks. I mean some of these dealers are smoking some good stuff

OMG the greed!
Maybe they want you to pay up-front for all the service you won't need from them for tune-ups, oil changes, transmission service, etc. over the next 10 years or so?
Fight inflation: walk away from that place as fast as you can.

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[chl]

Federal Tax Credit at the P.O.S won't be available until sales executed after 12/31/2023.
So, you will collect your credit while filing form 1040 ty-23 in the spring of 2024

Also: to get the reduced price right when you buy the car the dealer has to have signed up/registered as explained here: https://insideevs.com/news/690140/ev-tax-credit-guidance-update/

"For a vehicle purchase to qualify, dealerships interested in transferring the credit must sign up with a new website called IRS Energy Credits Online to become a registered dealer. Once registered, the dealership can transfer the credit to the point of sale.

Take the hypothetical taxpayer mentioned earlier who has a tax burden of [only] $5,000. With the new point-of-sale credit, that person can make off with a $7,500 reduction in the purchase price of their shiny new EV. In other words, consumers who score a credit for more than their tax burden won’t have to owe the IRS anything come tax season...

...people making over the income cap by the end of the year they claim the credit will not be in a beneficial spot. Say a single filer makes $150,001 in a given year and purchases an EV with a point-of-sale credit; he or she will actually have to pay back $7,500 taken off the car’s MSRP for the tax credit..."

That works for me - when I bought my Nissan Leaf in 2011, I didn't get the full tax credit because my liability was lower than $7500 - no longer need to worry about that.

Another reason I am glad I am waiting until next year to buy.

This may reduce the Lightning sales at delaerships the remainder of this year by those who are aware of the advantage of waiting until Jan 2024.

 

[TaxmanHog]

Email from Ford indicating reduction in Federal credits for the MME while the Lightning continues to have the potential for $7500.

 

[hturnerfamily]

It feels like with the 'original' EV Tax Credit requirements of at LEAST $7,500 of tax to pay for that filing year, you had to make a LOT of money to get there, especially when you think of the doubled Married Filing Jointly of almost $28,000 Tax Deduction right off the bat. It would take another ...

$22,000 at 10% for the first $2,200 of taxes, and then...
an additional $44,166 at the next bracket of 12%, for $5,300...
for a total income of at least $28,000+$22,000+$44,000 equaling $94,000 +
to create the $7,500 'tax burden' that the EV credit would offset...

but NOW, with the new 2024 'rules', it feels like you will be 'penalized' if you make TOO MUCH money.... it's crazy how this has totally flipped.
You now have to claim to be 'not so rich' to get the credit!

 

[TaxmanHog]

You now have to claim to be 'not so rich' to get the credit!

It's what our Representatives thought to be the right thing to do, the parameters are as they are with this intent not to create subsidies for the those with substantial means and preserve funding for the credit to those with modest means.

Let's not go down the political rabbit hole.

At the end of the day our entire society & economy pay for this.

 

[flyct]

Where did you read that? Looking at the Revised Q&A that @TaxmanHog linked to it says:

Q7. Is the new clean vehicle credit refundable or able to be carried forward? (updated October 6, 2023)
A7. The new clean vehicle credit may only be claimed to the extent of reported tax due of the taxpayer and cannot be refunded. The new clean vehicle credit cannot be carried forward to the extent it is claimed for personal use on Form 1040, Schedule 3, Additional Credits and Payments. However, the new clean vehicle credit can be carried forward to the extent it is claimed for business use on Form 3800, General Business Credit, as otherwise appropriate. See Topic H FAQ 3 regarding transfer of the clean vehicle credits.

So maybe for business but not individuals.

Well, it’s not officially refundable but next year if you meet the income requirements and collect the credit at point of sale the IRS has announced that it will not “claw back” the credit of your tax liability isn’t enough to cover it.

 

[ryun]

Dang MME @ 1.9% for 60 months? That's awesome.

 

[Pod]

As long as my tax liability exceeds $7500 withholding is irrelevant, right? Right now we are taking out additional money each month withholding to offset our tax liability. That $7500 will replace that and I can get that back, correct?

 

[Warren]

As long as my tax liability exceeds $7500 withholding is irrelevant, right? Right now we are taking out additional money each month withholding to offset our tax liability. That $7500 will replace that and I can get that back, correct?

Pretty sure that is correct. I am in the same boat. Will do everything I can to use every penny of the $7500

 

[Pod]

With the new Ford $7500 customer cash w/o financing requirement, I am contemplating upgrading to a Lariat. Apparently you can get two tax credits in the same year. Crazy times. Hope they give me a decent trade amount. Should just sell outright.

 

[Maquis]

With the new Ford $7500 customer cash w/o financing requirement, I am contemplating upgrading to a Lariat. Apparently you can get two tax credits in the same year. Crazy times. Hope they give me a decent trade amount. Should just sell outright.

Just make sure the new Lariat is under the $80K limit.

 

[TaxmanHog]

With the new Ford $7500 customer cash w/o financing requirement, I am contemplating upgrading to a Lariat. Apparently you can get two tax credits in the same year. Crazy times. Hope they give me a decent trade amount. Should just sell outright.

It's odd to think our tax code allows / encourages this form of double dipping, getting a credit for 1st vehicle, then turning it over as a trade in to another qualified EV, just doesn't feel right to me. (JMHO) the statute might allow it but I think one should be required to have the vehicle as of the close of the tax year to effectively claim the credit, (which is not how the "POORLY" written law is interpreted to be)

See this generic example, note the limitation yellow highlight at line 22.

How much is withheld in federal taxes from salary or paid via Estimated deposits does not come into play.

 

[Pod]

TBH seems a bit crazy to me as well but looks like it is allowed. Could wait till the new year, I suppose. But, rules may change.

 

[TaxmanHog]

FORD EVS COULD LOSE FEDERAL TAX CREDITS UNDER NEW GUIDELINES

While Ford is still devoting considerable resources toward its transition to fully electric vehicles, pricing remains a major issue for buyers. As Ford Authority previously reported, the company has been steadily adjusting prices for the Ford Mustang Mach-E and Ford F-150 Lightning over the past year or so, either through incentives or with entirely new batteries, as demonstrated by the former vehicle, which now comes with a standard LFP battery. But the passage of the Inflation Reduction Act also introduced a substantial set of incentives into the mix, although some requirements were still being worked out, until recently. Now, the Biden administration has released its guidelines on federal tax credit eligibility for vehicles that source components from overseas. Per Automotive News, Ford EVs might lose eligibility starting in 2024 should they fail to meet the new requirements.

rest of story here.................
https://fordauthority.com/2023/12/ford-evs-could-lose-federal-tax-credits-under-new-guidelines/

 

[Ventorum94]

FORD EVS COULD LOSE FEDERAL TAX CREDITS UNDER NEW GUIDELINES




rest of story here.................
https://fordauthority.com/2023/12/ford-evs-could-lose-federal-tax-credits-under-new-guidelines/

Seems unlikely to apply to unsold 2023 Lightning SR-ER, pre-LFP 2024 Lightning SR, and 2024 Lightning ER, all of which have battery packs from SK ON, headquartered in our erstwhile ally nation, South Korea and manufactured in USA.

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