List of Model Y configs that qualify for the 2023 Federal Tax Credit

New price drops tonight, here is my view of which Model Y qualify for the 2023 federal tax credit between now and March:

Model Y Performance 5-seater (MSRP gotta be under $55k) : None of them qualify.

Model Y Long Range 5-seater : Gotta stay under $55K before destination charge. These configs will quality for the federal tax credit [exterior/interior/wheels]:
- Red/Black/19s
- Black/Black/19s
- White/Black/19s
- White/Black/19s with Tow
- White/Black/20s
- White/White/19s
- White/White/19s with Tow
- Gray/Black/19s
- Gray/Black/19s with Tow
- Gray/White/19s
- Blue/Black/19s
- Blue/Black/19s with Tow
- Blue/White/19s

Model Y Long Range 7-seater (Gotta be under $80K) : All of them qualify with any color, wheel, tow hitch, interior options. Don't add FSD or EAP to keep it under $80K.

Admin note: Image added for Blog feed.

 

[arbitrage000]

For the folks that already ordered and received Order agreement shown price for $54,990 included White/White/19s with Tow. Those folks still qualify, correct? Moving forward new order does not meet federal tax credit.

That would be my guess. I don't know the procedure to submit to IRS for credit but as long as all they want is your MVPA to show that your order was under $55K then you should be fine. Tesla will always honor the price at order time so unless IRS has weird rules and is going to look at current MSRP and not your specific order, I think you will still qualify.

 

[JCLJorgenson]

For the folks that already ordered and received Order agreement shown price for $54,990 included White/White/19s with Tow. Those folks still qualify, correct? Moving forward new order does not meet federal tax credit.

Yes, because that is the price you will pay and it is below the $55k limit. Only new orders will be impacted by the change.

 

[arbitrage000]

With yesterday's $500 price increase the qualifying configs were cut drastically. No Red config qualifies, 20" don't qualify and only a single option (paint, white seats or tow) can be selected without going over.

Model Y Long Range 5-seater : Gotta stay under $55K before destination charge. These configs will quality for the federal tax credit [exterior/interior/wheels]:
- Red/Black/19s
- Black/Black/19s
- White/Black/19s
- White/Black/19s with Tow
- White/Black/20s
- White/White/19s
- White/White/19s with Tow
- Gray/Black/19s
- Gray/Black/19s with Tow
- Gray/White/19s
- Blue/Black/19s
- Blue/Black/19s with Tow
- Blue/White/19s

Actually made a mistake....Blue/White and Gray/White aren't possible. That leaves 6 configs.

 

[Sunshine Speed]

With the $500 price increase last night, here are the Model Y configs that have MSRP under $55,000 and qualify for the $7500 federal EV tax credit as of Jan24:

Model Y Long Range 5-seater configs that qualify: (exterior/interior/wheels)
- Black paint/Black interior/19s
- Gray paint/Black interior/19s
- Blue paint/Black interior/19s
- White paint/Black interior/19s
- White paint/Black interior/19s with Tow hitch
- White paint/White interior/19s

Model Y Performance 5-seater : None of them qualify.

Model Y Long Range 7-seater (Gotta be under $80K MSRP) : ALL configs qualify with any color, any wheels, tow hitch, any interior.

 

[Srikanthm79]

t our wheel cover afterwards and it will look like the 20' but with better range and ride quality(sry for the shameless advertisement ). The paint and interior color are much harder to change aftermarket!

With the $500 price increase last night, here are the Model Y configs that have MSRP under $55,000 and qualify for the $7500 federal EV tax credit as of Jan24:

Model Y Long Range 5-seater configs that qualify: (exterior/interior/wheels)
- Black paint/Black interior/19s
- Gray paint/Black interior/19s
- Blue paint/Black interior/19s
- White paint/Black interior/19s
- White paint/Black interior/19s with Tow hitch
- White paint/White interior/19s

Model Y Performance 5-seater : None of them qualify.

Model Y Long Range 7-seater (Gotta be under $80K MSRP) : ALL configs qualify with any color, any wheels, tow hitch, any interior.

Do we still get to qualify for tax credit when the order date in in Jan 2023 and delivery pshed out after March 31st ? any clue?

 

[Fusion]

Do we still get to qualify for tax credit when the order date in in Jan 2023 and delivery pshed out after March 31st ? any clue?

It's when the car is delivered. So things might change after March 31st. If they decide that it's half, then you will only get half of the current tax credit.

 

[Sunshine Speed]

Do we still get to qualify for tax credit when the order date in in Jan 2023 and delivery pshed out after March 31st ? any clue?

The $7500 federal EV tax credit is only guaranteed until March 1st. Anytime after that, the rules could change. My guess is:
- 75% chance that the rules for the $7500 tax credit will not change at all for full year 2023.
- 20% chance that sometime during March or April it will change to $3750 tax credit for Model Y that meet the MSRP limits.
- 5% chance that they will find a way to make the tax credit $0 for all Teslas in March or April.

 

[exfed2001]

EV rebate rules are Just not accurate or fair.

Why is an elephant bigger than a mouse? No reason. Policy.

 

[JCLJorgenson]

The $7500 federal EV tax credit is only guaranteed until March 1st.

I'm not sure if that statement is 100% accurate. The IRS has said they will not implement the sourcing requirements until they provide further guidance, which is expected to happen "sometime in March." In short, they could decide to provide new guidance tomorrow, in the middle of March, or defer to later in the year. All we know is you are probably safe as long as you take deliver after January 1 and before the new sourcing guidance happens. As noted in an earlier post, Senator Manchin is trying to pass a bill that would halt the tax credit until the IRS provides guidance, so there is also some risk there (I think it will be hard to make it retroactive to January 1).

There was a crazy mad rush to order Teslas after they significantly dropped their price and qualified for the tax credit. If you order today, there is a good chance you may not take possession of the vehicle before the new guidance happens (but the potential tax savings may be worth risking loss of the $250 order fee).

 

[lovenil]

Senator Manchin has introduced bill to delay tax credits by retro date of Jan 1,2023.. if that passes no one gets full credit

 

[Tonybe93]

What if it’s a myp but it’s a demo model that’s brand new under 55k. Would this qualify?

 

[Evpowerdan]

What if it’s a myp but it’s a demo model that’s brand new under 55k. Would this qualify?

Demo from Tesla is considered "New", with a discount off the MSRP for mileage or etc. Thus, the original MSRP is what matters - 5 seater over $55k does not quality. At least that's how I read the confusing IRA EV tax rebates.

 

[JCLJorgenson]

What if it’s a myp but it’s a demo model that’s brand new under 55k. Would this qualify?

The IRS uses the vehicle's MSRP to determine eligibility, not the actual price paid. In regards to a demo MYP offered at a discount, I'm guessing the MSRP would probably be the same, then they would show some sort of credit against it? The guidelines say you need to verify what's on the vehicle's sticker - see Q4 and Q3 in the link below:

Topic B — Frequently asked questions about income and price limitations for the New Clean Vehicle Credit | Internal Revenue Service

Frequently Asked Questions about income and price limitations for the new Clean Vehicle Credit.

www.irs.gov

 

[Sunshine Speed]

Update : ALL Tesla Model Y now qualify for the federal EV tax credit, no matter what the configuration or Options. This hit the official IRS website today. MSRP limit is now $80K for all Tesla model Y. A Reuters news report said that this will be retroactive back to January 1st. Wow.

Also - currently the federal EV tax credit is $7500, but they MIGHT change some rules in March that could reduce it to $3750 based on battery minerals requirements.

 

[tangible1]

The $7500 federal EV tax credit is only guaranteed until March 1st. Anytime after that, the rules could change. My guess is:
- 75% chance that the rules for the $7500 tax credit will not change at all for full year 2023.
- 20% chance that sometime during March or April it will change to $3750 tax credit for Model Y that meet the MSRP limits.
- 5% chance that they will find a way to make the tax credit $0 for all Teslas in March or April.

let's not forget that for 2024, the credit is scheduled to become a POINT OF SALE CREDIT rather than tax credit.
so the rules may change, and I'd guess that would happen for Govt 2024 Fiscal Year starting Oct 1 2023

 

[vlc92189]

I am really stuck on ordering the MYLR now or waiting another year or so. The point of sale credit is very appealing. What would you do in this situation?

let's not forget that for 2024, the credit is scheduled to become a POINT OF SALE CREDIT rather than tax credit.
so the rules may change, and I'd guess that would happen for Govt 2024 Fiscal Year starting Oct 1 2023

 

[tangible1]

I am really stuck on ordering the MYLR now or waiting another year or so. The point of sale credit is very appealing. What would you do in this situation?

with so much political variability, and no gobsmacking upgrade on the horizon, I'd be leaning to just getting it. assuming you can use the full tax credit.

but do you really need a new car, or just want one? are your current vehicles paid for or still in loans?
too many variables for anyone else to make your decision.

 

[vlc92189]

`````

with so much political variability, and no gobsmacking upgrade on the horizon, I'd be leaning to just getting it. assuming you can use the full tax credit.

but do you really need a new car, or just want one? are your current vehicles paid for or still in loans?
too many variables for anyone else to make your decision.

Long story short.. I bought a 2022 Mercedes GLB 250 4MATIC for work. Family works for MB so service is at cost, and I bought the vehicle for not much more than a rav4 during covid when prices were at a high. Paid roughly 46 before taxes. I drive roughly 27-30k annually. I wanted an EV (MYLR) before my MB but could not justify the price hike. I would have negative equity if I were to sell my car right now but I didn't put any money down initially since work covers. I get a monthly stipend plus mileage. Roughly $1200-$1500 a month. I figured this is a great opportunity for me to get the car I wanted, plus save on maintenance/gas.

 

[tangible1]

`````

Long story short.. I bought a 2022 Mercedes GLB 250 4MATIC for work. Family works for MB so service is at cost, and I bought the vehicle for not much more than a rav4 during covid when prices were at a high. Paid roughly 46 before taxes. I drive roughly 27-30k annually. I wanted an EV (MYLR) before my MB but could not justify the price hike. I would have negative equity if I were to sell my car right now but I didn't put any money down initially since work covers. I get a monthly stipend plus mileage. Roughly $1200-$1500 a month. I figured this is a great opportunity for me to get the car I wanted, plus save on maintenance/gas.

your call !!

 

[Evpowerdan]

I am really stuck on ordering the MYLR now or waiting another year or so. The point of sale credit is very appealing. What would you do in this situation?

With the IRA EV tax credit/rebating in flux, there could be positive or negative changes ahead. If you need a vehicle today and qualify for the IRA EV rebate - go pull the trigger. If not, once the smoke clears on what qualifies and for how much - that may change the pricing. Demand is spiked right now, as the unknown after March on the rebate is creating FOMO (fear of missing out).