Current Ads selling Model 3 Reservations...anyone else seen them?

[dsvick]

As far as I've heard they have not granted any reservation transfers yet. So it sounds like they are taking the safest approach and not granting any, or only doing so in special cases like a death or something equally extreme. If that's the case, and if it's true that whoever the reservation is under also has to be on the title then I'm not sure how anyone will be able to "sell" their reservation. I think it'll end up depending on state laws for title transfer or for removing a name from a title.

Either way if I was the buyer or seller I'd certainly get something legal drawn up if I trying this.

 

[HankLloydRight]

Not everyone wants FSD. If I wanted to buy a car for my parents, they really don't care about that. And live in a different state entirely.

The point is, if they start denying existing owners the ability to use their reservation to buy a car for an immediate family member (regardless of address of residence-- which was not a stipulation at the time of making a reservation), that's going to be an even bigger PR problem. The only thing Tesla said was "reservations are not transferrable". They can't change the rules or make up new rules of executing a reservation after the fact.

 

[HankLloydRight]

and if it's true that whoever the reservation is under also has to be on the title

That's never been established.

 

[markb1]

This is not the first time Tesla has taken "non-transferable" reservations for their cars. I don't recall any restrictions on what name went on the registration when I bought my Model S, though my memory is not 100% on those details. But it seems like we should be able to look back to get a hint on how it might be done going forward.

 

[WileyTheMan]

I believe the whole point of this policy is to be as fair as possible to those who put their faith in a young and (somewhat) untested car company, and to deter those who who would take advantage of it for the purpose of personal profit. As people have said, PR is more important to them at this point than sales for this car. The car will sell itself for the next few years.

 

[SageBrush]

I presume we are going to see a couple threads in the next couple of months from people who tried to buy a scalped Model 3 and "didn't know or were not told " of unexpected consequences.

The mods are going to be busy

 

[az erik]

I Know Tesla is adamantly against this, and there are so many complications with tax credit issues, etc....
But people are already doing it anyway. Here is an excerpt from a current local ad where I live. He is a current Model S owner:

"Get a Tesla Model 3 before anyone else.

If you place a reservation today you will wait over a year and a half. I am scheduled to have one of the first deliveries in (Name of State).

With current situation I am planning on keeping my Model S and selling my Model 3. I was going to order the car and sell it when it got here. I figured someone would want to customize the car and pick out a certain color and options. I am willing to sell my reservation for $7000 and you get to keep my $1000 deposit. So it is $6,000.

I don't know if Tesla is going to make me purchase the car in my name and then I can turn around and sell it to you or if they will let me purchase it or register it in your name. I know they will let me put it in a business name so I don't think they would have a problem with putting it in someone else name. You will be responsible for all sales tax and registration fees.

I am willing to meet in person, you can come to my office and we can pick out options you want. I would want $3,000 to place the order with your specific requests and then the other $3,000 when the car gets here. I should be getting an email in the next few weeks to configure the car and the sooner I do that the better.

Please call or text with any questions. "

Yep I saw that same ad, he lowered his price $1k already haha.

 

[dsvick]

...and if it's true that whoever the reservation is under also has to be on the title ...

That's never been established.

Which is why I used the word "if".

 

[HankLloydRight]

I found two of these ads on my local craigslist... each with a slightly different offering.

Tesla Model 3 Reservation
Tesla Model 3 This Fall

 

[3Victoria]

Seems simple --- buy the car in your name. What you do afterwards is up to you. If you want to give it to your parents/step-daughter/stranger, go ahead. If you want to sell it, go ahead -- there may or may not be financial penalties or benefits.

 

[SMAlset]

I found two of these ads on my local craigslist... each with a slightly different offering.

Tesla Model 3 Reservation
Tesla Model 3 This Fall

Funny how the 2nd person says they'll keep the tax credits. I'm pretty sure you don't get the tax credit if you haven't kept the car a certain amount of time to prevent just this type of abuse of the tax program.

 

[HankLloydRight]

. I'm pretty sure you don't get the tax credit if you haven't kept the car a certain amount of time to prevent just this type of abuse of the tax program.

You get the tax credit when you claim it on your tax return.

The only way you might lose it is if you're audited and the examiner concludes you specifically bought the car for resale.

Besides an audit, there's no mechanism in place to claw back the tax credit if/when you sell the car. There is no built-in "time limit" that triggers if you sell the car with respect to the tax credit.

The following requirements must be met to qualify for the credit.

• You are the owner of the vehicle.
• If the vehicle is leased, only the lessor and not the lessee, is entitled to the credit.
• You placed the vehicle in service during your tax year.
• The vehicle is manufactured primarily for use on public streets, roads, and highways.
• The original use of the vehicle began with you.
• You acquired the vehicle for use or to lease to others, and not for resale.
• You use the vehicle primarily in the United States

 

[heysteveh]

I found two of these ads on my local craigslist... each with a slightly different offering.

Tesla Model 3 Reservation
Tesla Model 3 This Fall

I won't be surprised if we see these kinds of ads popping up a lot more in coming months. Maybe we should start a thread to post the most creative ads for attempting to profit from a Model 3 Reservation!!

 

[SMAlset]

You get the tax credit when you claim it on your tax return.

The only way you might lose it is if you're audited and the examiner concludes you specifically bought the car for resale.

Besides an audit, there's no mechanism in place to claw back the tax credit if/when you sell the car. There is no built-in "time limit" that triggers if you sell the car with respect to the tax credit.

Here's what California's program says about length of time of ownership to qualify for their EV program:

Applicant and Vehicle Requirements
As a condition for receiving State of California, Air Resources Board (CARB) rebate funds, you (the applicant/purchaser/lessee) must comply with the requirements below. You are responsible for reviewing the CVRP program requirements prior to applying for a rebate. Eligible applicants must meet requirements that include, but are not limited to, the following (paragraphs are misnumbered from original text due to copy paste formatting transfer of info): .....

1. Rebate recipients who do not retain the eligible vehicle for the full 30-month ownership or lease period will be required to reimburse CARB all or part of the original rebate amount.
   1. Vehicle purchaser or lessee is required to notify the Administrator to arrange for early termination of vehicle ownership in advance of intent to sell or terminate a lease prior to the required 30-month ownership period.
   2. CARB will periodically check vehicle identification numbers with vehicle registrations to ensure that CVRP applicants meet this requirement. If an applicant violates this requirement, CARB or its designee reserves the right to recoup CVRP funds from the original vehicle purchaser identified on the rebate application form and may pursue other remedies available under the law.
2. Register the new vehicle with the DMV for a minimum of 30 consecutive months from the original purchase or lease date for use in California.
   1. Any government owned vehicle not registered with the DMV is still required to operate within California for 30 consecutive months immediately after the vehicle purchase or lease date.
3. Be available for follow-up inspection if requested by the Administrator, CARB, or CARB’s designee.....

I would think to lie on an application for a State rebate or IRS tax credit would be considered fraud.

 

[HankLloydRight]

I would think to lie on an application for a State rebate or IRS tax credit would be considered fraud.

But that's the problem with the IRS regulations... there's no guidance on how to interpret the following:

• You acquired the vehicle for use or to lease to others, and not for resale.

Any one of these 'reservation scalpers' could honestly claim they acquired the vehicle for their own use ('not for resale'), and then only decided to sell it later because of some other factors, as simple as 'I didn't like that there was no dashboard' or 'I decided to sell it and wait for the AWD version' or 'Tesla announced a performance version I want to upgrade to'. Then it would be up to the auditor to decide or find proof to counter those claims and deny the tax credit, which is a very hard threshold to reach a year after the ad above ran. I'm not saying it's not fraud, but unlike most tax fraud, this one is very hard to prove.

 

[dsvick]

Maybe we should start a thread to post the most creative ads for attempting to profit from a Model 3 Reservation!!

Better yet, start a thread where we collect all the names and as much info as we can about the seller, and tell them we're reporting them all to the IRS. Maybe it'll convince some of them to cancel instead of selling their reservation, and maybe some of them will be in front of us in line.

 

[SageBrush]

Then it would be up to the auditor to decide or find proof to counter those claims and deny the tax credit, which is a very hard threshold to reach a year after the ad above ran. I'm not saying it's not fraud, but unlike most tax fraud, this one is very hard to prove.

Up until tax court, the taxpayer gets to try and convince the IRS that the auditor is wrong.

In tax court a little discovery shows that the car was sold unused. End of story

 

[HankLloydRight]

Better yet, start a thread where we collect all the names and as much info as we can about the seller, and tell them we're reporting them all to the IRS. Maybe it'll convince some of them to cancel instead of selling their reservation, and maybe some of them will be in front of us in line.

There's only one instance I've seen where the scalper wants to keep the tax credit for himself. All the rest are 'register in the buyer's name' which is totally legal.

Up until tax court, the taxpayer gets to try and convince the IRS that the auditor is wrong.

In tax court a little discovery shows that the car was sold unused. End of story

What's "unused"? Less than 100 miles? 200 miles? 500 miles? Where's the dividing line between what's considered 'unused' versus 'used'? Just put that many miles on the car, so it's considered by any reasonable person to be 'used'. Or even have a Bill-of-Sale that sold the car as "used/as-is". The title would be transferred as a used car. As I said, there could be several totally legitimate reasons why someone would sell their used Model 3 shortly after buying it.

I also doubt a dispute over a $7500 tax credit (or more than likely $3,750) would ever get to the tax court, as the legal fees on both sides would dwarf that amount.

 

[SageBrush]

I also doubt a dispute over a $7500 tax credit (or more than likely $3,750) would ever get to the tax court, as the legal fees on both sides would dwarf that amount.

Which is why I pointed out that before that point, the taxpayer is guilty if deemed so by the auditor unless he can convince the IRS otherwise.

A scalper is unlikely to annoy his car insurance to insure the car, and then and drive around for the weeks/months needed to pass the smell test with an IRS auditor. After all, the entire pitch here to justify the scalper fee is that the customer jumps ahead in line for a new Tesla. I think it is going to be difficult for the scalper to satisfy the customer, the insurance company, and the IRS. Oh, and avoid sales tax twice in those states that collect.

Family is more of grey zone like you intend, particularly if registration is in two names.

 

[TimM.]

"You can get your new Model 3 18 months sooner, configured as you like it. All you need to do is give me $5000 and legally change your name to the same as mine: Bonshoof Pinklefeather."