Federal Tax Credit may be coming back for Tesla purchases

[Ostrichsak]

Why are they putting the verbiage in this bill about used EV purchase? How does this help with the green movement? It's like a lateral movement to me. This doesn't help increase any manufacturing of greener vehicles.

Don't underestimate the impact that used EVs have on the adoption of EVs. Not everyone who values something like this has the ability to (or even wants to) spend six figures on a depreciating asset.

 

[David_Cary]

And most who sell an EV will buy another so there is a bit of a trickle down effect. But mostly it is a way to include everyone in the benefit - not just the better off that buy new cars.

 

[Ostrichsak]

And most who sell an EV will buy another so there is a bit of a trickle down effect. But mostly it is a way to include everyone in the benefit - not just the better off that buy new cars.

We're in agreement right up until you drew the conclusion that buying new is somehow an indicator that you're "better off" as all it really proves is that you have the ability to borrow lots of money (in many cases) and I would actually argue that you're "worse off" but that's another conversation entirely.

 

[stopcrazypp]

We're in agreement right up until you drew the conclusion that buying new is somehow an indicator that you're "better off" as all it really proves is that you have the ability to borrow lots of money (in many cases) and I would actually argue that you're "worse off" but that's another conversation entirely.

Yep, a lot of people "buying" new are taking loans with ridiculous interest rates, which was a major factor in the previous recessions.

Anyways, on the subject of people waiting for this tax credit to make a car purchase, I'm not so optimistic it'll necessarily pass anytime soon (or the various different similar ones). I was more optimistic earlier in the year, but it seems there's little to no movement yet so far.

 

[Wigan]

So am i correct in understanding that with a nonrefundable credit like the 7500, you can only get credit if you owe correct? If you owe nothing you get nothing. If you get a refund normally you also get nothing. Am i correct in this understanding?

Don't confuse yourself with the word 'owe'. It has nothing to do with what you owe the IRS, or the IRS owes you, when you 'settle up' by filing your tax return n April. The credit is against your full tax liablity, not whatever's left after withholding. So if your tax liability is $10,000, and you've had $11,000 withheld, your tax liability is still $10,000. Withholding is simply prepaying it, not reducing it. So in that case if the credit were $10,000 it would reduce your tax liability to zero and you'd get your entire withholding back instead of just $1,000.