Is my $7500 tax credit in jeopardy

[Ken7]

Please please, let’s not make this political, but if the new tax reform plan goes through, will this eliminate the $7,500 tax credit on my just purchased Model S? That would be quite a hit.

Logically, I would think that the new plan would not be retroactive to 2017, but rather going forward to 2018.

Any tax accountants out there with some idea?

 

[Az_Rael]

Are you waiting for delivery? If so, than, yes, your $7500 is in jeopardy. You need to take delivery before 12/31/17 if the legislation passes.

The way the credit works, it’s based on the in service date for the car, so you can’t just pay up front, you have to actually get the vehicle.


If the $7500 is critical, you could see if there is an inventory car that fits your needs that might arrive before the end of the year.


If you already have your car, then you are good. The proposal doesn’t retroactively apply it to 2017, and I seriously doubt they will change it to do that

 

[Tiger]

See GOP tax reform bill would end the $7500 EV tax credit

 

[croman]

Its not retroactive but I wouldn't put it past them.

 

[kort677]

Please please, let’s not make this political, but if the new tax reform plan goes through, will this eliminate the $7,500 tax credit on my just purchased Model S? That would be quite a hit.

Logically, I would think that the new plan would not be retroactive to 2017, but rather going forward to 2018.

Any tax accountants out there with some idea?

no, I do not believe that if the credit is repealed that it would be retroactive to past purchases, as long as you take delivery prior to the legislative passage and signature of the president enacting the legislation.

 

[deonb]

Are you waiting for delivery?

No, he picked up his car on September 30th:

New car issue with Nav & charge

 

[dragoljub]

For those of us who purchased in 2017 there is some sigh of relief. Hope it does not go through so Model 3 has more demand.

 

[kort677]

For those of us who purchased in 2017 there is some sigh of relief. Hope it does not go through so Model 3 has more demand.

there may be a ton of demand, but getting cars out the door is the issue here. even clearing the backlog of orders in the next 12-18 months seems out of the picture.

 

[spooky981]

Wonder if wiping out that tax credit was a subtle ****-you to Elon for quitting the panel he was on.

 

[kort677]

Wonder if wiping out that tax credit was a subtle ****-you to Elon for quitting the panel he was on.

moves, counter moves.
IMHO elon was foolish for the attitude he displayed regarding that ceremonial council, he acted out in the kabuki theater aspect of politics, got a headline or two but didn't think of the long term affects of kicking sand in face of the deal/rule makers.

 

[jmitchell]

For those of us who purchased in 2017 there is some sigh of relief. Hope it does not go through so Model 3 has more demand.

I don't think it'll change demand all that much. Most people on the list know they won't be getting the full incentive.

 

[kort677]

I don't think it'll change demand all that much. Most people on the list know they won't be getting the full incentive.

how do you come to that conclusion? a large number of people lease their tesla and the $7500 is built into the equation so those people do get the full benefit of that credit. the only ones who forsake the full benefits of the tax credits are the ones who either are not able to meet the reported income threshold or do not file itemized returns. I cannot say for certain what the size of that group is but I bet that it isn't most.

 

[Ross9733]

Honestly, the ending of the credit would be a gift to tesla. They are getting to 250k next regardless of the tax credit and will sell lots of model 3 cars without the credit. However tesla issue will be in 2 years when bmw Porsche Volvo etc come to market with their own EV’s that will be eligible for the credit when Tesla’s will not.

 

[ucmndd]

Honestly, the ending of the credit would be a gift to tesla. They are getting to 250k next regardless of the tax credit and will sell lots of model 3 cars without the credit. However tesla issue will be in 2 years when bmw Porsche Volvo etc come to market with their own EV’s that will be eligible for the credit when Tesla’s will not.

Agree. The way this credit was structured is really screwy, to the point of eventually penalizing the market leaders who are generating the most sales. It would be better for Tesla for the current version to go away entirely and put them on equal footing with their competitors.

 

[kort677]

Agree. The way this credit was structured is really screwy.

government at work?

 

[Pandamoanium]

It shouldn't. I believe it's based on delivery or day of sale technically and not based on when you go to register the vehicle. Now if for some reason it's based on registration and you're temp goes beyond 2017...

 

[Uncle Paul]

If adopted as written, everybody who takes delivery before the end of 2017 will be eligible.
After Jan 1, 2018, no more tax credit.

It may be changed to reduce the tax credit next year, or put a income ceiling on elegibility, nobody knows for sure now.

 

[suraj1194]

Wonder if wiping out that tax credit was a subtle ****-you to Elon for quitting the panel he was on.

How does it hurt Elon ? His company is the closest to losing the credit due to the phaseout clause, as Tesla is the closest to it. He stood to lose the most when Tesla ran out of the credit - while his competitors retained the benefit. Now that everyone's losing it in one stroke, every one of his competitors who could otherwise command a $7500 tax benefit on at least 200K cars each, no longer have that price competitiveness vs Tesla. And those like GM who have partially used up their benefit, lose their remaining runway.

 

[scottf200]

Wonder if wiping out that tax credit was a subtle ****-you to Elon for quitting the panel he was on.

What about the other big players here ... won't General Motors, Ford, Nissan, Tesla, BMW, Kia, and more, etc use their political pull to try to stop this?

InsideEVs: By year’s end, GM should be around 167,000 sales, while Tesla just over 160,000.

 

[croman]

What about the other big players here ... won't General Motors, Ford, Nissan, Tesla, BMW, Kia, and more, etc use their political pull to try to stop this?

They don't care about EVs (except Nissan). Nissan probably has used almost as many credits up as Tesla. 100k in Jan 2017. Tesla is at like 140k. I think Nissan is probably at 120k with Leafs in US. But GM also used up a lot of their credits on the Volt (even though it only got part of the credit).

The fact is that most companies don't care. ICE cars are the money makers.