I read yesterday that the there is a proposal to increase the EV tax credit from $7500 to $10,000. Anyone else notice this? http://www.autoweek.com/article/20120215/GREEN/120219919 http://www.plugincars.com/president-obama-proposes-10000-electric-vehicle-incentive-112506.html
That has been brought up by President Obama in the past but has no chance of passing the House, especially in an election year unfortunately.
Agreed there is no chance it will pass this year. And little chance in a future year. But moving it from a tax credit to a POS rebate...that may be possible, less expensive, and I think more useful.
Less paperwork for the government, although they don't get the "float" on your money. It's obviously better for EV sales, if you buy an EV on Jan 2 of any year, you might have to wait 13 months or longer for your credit (assuming you could file on February 1st of the next year, which is doubtful, more like most would not file until March or April, 15-16 months worst case). An even bigger issue is if you are financing, you don't have to carry that $7,500 or $10,000 in extra interest & principal payments, making EVs more affordable (lower monthly payments)
Sorry, I wasn't clear--I meant that converting the $7,500 tax credit to a POS rebate is less expensive (to the government) than raising the tax credit to $10k. Because it's less expensive, it may be possible to get done. And Mitch pointed out some reasons why it's useful.
A POS discount would be a major change and would increase the total cost of the program. The $7500 tax credit can only be used to reduce your tax liability; if you don't pay at least $7,500 in taxes, you can't (fully) use it -- and there are a lot of Americans who don't pay that much in income tax, even Americans who can afford a Model S.
I have heard this before, but I don't see how it would be possible. I would expect that any family with over $50,000 annual income would have over $7,500 tax liability. GSP
Robert - Bond interest payments are taxed as ordinary income, so rates can be as high as 35% -- more than double the maximum 15% levy on stock dividends. Also, bond (as well as stock) investments are post tax - so that money has already been taxed already.
I believe Robert was referring to Muni Bonds which don't have federal tax on their interest payments. I'm doubting someone would have a portfolio that's completely muni bond though
My guess is that any family in the $50,001 to $200,000 range is not going to have any tax loss carry-forwards. You have to be in the seven figures or close to it range to get those kind of tax breaks.