swaltner
Active Member
I thought you had to hold the car for 3 years to keep the federal tax credit....Same with CA state credit.
No, while the California tax credit has a 3 year minimum ownership period for keeping the full credit, there is no 3 year limit on the Federal Tax Credit for EVs.
The instructions for IRS form 8936 clearly state that specific requirement as:
* You acquired the vehicle for use or to lease to others, and not for resale.
No time frame is given on the ownership period. Posting an advertisement that you are looking for someone to buy your yet-to-be purchased EV establishes intent that you purchased the vehicle for resale.
If someone with more money than brains came up to me on the 2nd day of ownership of my Model 3 and offered me 3x my purchase price, I'd be a fool to not sell the car, pay off the mortgage on the house with the excess cash and get back in line for another Model 3. In this situation, I would expect the IRS to audit, but would be ready to argue that the credit was taken in good faith.
It boils down to not making plans to resell the EV before the time of purchase and you're fine with the IRS.