Model 3 LR not currently available to order (USA) [posted 08.12.2022 --Its back! 05.02.2023]

[Snow Drift]

How it was in the past? There was no price limit for this tax credit in the past. They already have a condition requiring a binding order contract for the rebate this year, so I expect additional documentation will be required to claim the rebate.

There is nothing complicated about submitting your MVPA with your claim.

Let me clarify. State rebates have MSRP limitations. They are determined by the Base MSRP (ex. NYS = max $2,000 rebate if <$42,000 MSRP. Oregon = $7,500+ rebate if <$50,000 MSRP. "Vehicles must be registered in Oregon for at least two years and have a base manufacturer’s suggested retail price of less than $50,000."

They list all the cars eligible, and you are not nickled and dimed for options/accessories. Would you submit your window sticker? They will probably just have you submit your VIN on the IRS form. The VIN will easily identify the trim and year. Certain VINs are eligible. A 2023 Model 3 Performance is not. Then, if you get audited, they will review if it was eligible.

Binding Contract was not for Tesla. Also, it requires a non-refundable 5% deposit. Basically, no one is able to take advantage of that. Like the whole Act, it was designed to be a great headline and not actually sell more EVs.

 

[MP3Mike]

Let me clarify. State rebates have MSRP limitations. They are determined by the Base MSRP

Sure, but the IRA bill doesn't state that it goes by the base MSRP. This is what it says:

“(A) IN GENERAL.—No credit shall be allowed under subsection (a) for a vehicle with a manufacturer’s suggested retail price in excess of the applicable limitation.

No mention of looking at the base MSRP. And I would argue that a car with a base price of $40k, with $20k of options added, has an MSRP of $60k. (As would be listed on the Monroney sticker.)

So unless the guidance significantly changes the wording there, options will be include in the MSRP calculation.

 

[Snow Drift]

Sure, but the IRA bill doesn't state that it goes by the base MSRP. This is what it says:



No mention of looking at the base MSRP. And I would argue that a car with a base price of $40k, with $20k of options added, has an MSRP of $60k. (As would be listed on the Monroney sticker.)

So unless the guidance significantly changes the wording there, options will be include in the MSRP calculation.

I hear you, but I don't agree. The IRS is not going to spend a lot of time sifting through Monroney stickers when they can just look at a VIN. VIN will answer the first two questions, 1) North America or other countries 2) Trim = MSRP that all cars of that trim share.

Then they can release an easy to understand list of pre-approved cars, just like each state for their rebates.

Even Destination could make one car eligible and another not. Example, Hawaii usually has a higher Destination price than on the mainland. Another example, Subaru has 4 different distribution groups, and they all have different Destination prices, depending on where you live.

 

[Snow Drift]

I just got an email from Chevy about their new Equinox EV. In the fine print it says the following:

"4 - The Manufacturer's Suggested Retail Price excludes destination freight charge, tax, title, license, dealer fees and optional equipment. Click here to see all Chevrolet vehicles' destination freight charges. Dealer sets the final price."

Now does that mean options like colors, textiles, packages, etc, or does that mean dealer installed accessories? If it means optional equipment installed at the factory/port (Monroney sticker items), then perhaps in the industry MSRP really is the base price. Options are just extras on top.

If you think about it, that makes this easier for the OEMs. To be eligible, you need to have a MSRP of under $55k. Ok, so the car starts at $54,999. If you have to take into account option packages, then you need to say ok, well the MSRP would need to be $50,000 because we offer $5k in options, which could be selected.

 

[MP3Mike]

I hear you, but I don't agree. The IRS is not going to spend a lot of time sifting through Monroney stickers when they can just look at a VIN.

Like all things with the IRS, it will likely put the onus on the filer to follow the rules. With the IRS then auditing some.

VIN will answer the first two questions, 1) North America or other countries 2) Trim = MSRP that all cars of that trim share.

Even if they go that way "trim" does not equal base. There are three different VINs "trims" for the Model 3, and Model Y. So maybe they will go with that price and not worry about paint/wheels/interior/FSD. But that would still separate RWD, AWD, and Performance.

Then they can release an easy to understand list of pre-approved cars, just like each state for their rebates.

How would it not be easy to understand if they listed car models that meet the requirements and included an "and MSRP on Monroney under $50k." condition?

Even Destination could make one car eligible and another not. Example, Hawaii usually has a higher Destination price than on the mainland.

Nope. Destination charges are legally required to be the same for all destinations. (It can be different per model/factory, but for example the Model S comes from a single factory so the destination charge for anywhere in the US is required to be the same.) What is a destination charge? And do you have to pay them? | Autoblog

What does the destination charge cover?​

Also known as the destination fee, the destination charge theoretically covers the cost it takes to get a car from the factory to the dealership. It's usually a flat fee, which doesn't vary by region. It's "equalized" – that is to say, the average cost to ship cars all over the country. If your dealer is right next to the factory that built the car, too bad – you have to pay, too, so folks a couple thousand miles away don't have a massive charge.

Is the destination charge regulated by the government?​

The way in which the destination charge is calculated (that equalization thing mentioned above) is government mandated as is the need to make it an individual line item on the Monroney sheet – that window sticker with the MSRP and all the other options fees broken out.

But we are all just guessing until formal guidance is issued at the end of the year.

 

[MP3Mike]

I just got an email from Chevy about their new Equinox EV. In the fine print it says the following:

"4 - The Manufacturer's Suggested Retail Price excludes destination freight charge, tax, title, license, dealer fees and optional equipment. Click here to see all Chevrolet vehicles' destination freight charges. Dealer sets the final price."

Now does that mean options like colors, textiles, packages, etc, or does that mean dealer installed accessories? If it means optional equipment installed at the factory/port (Monroney sticker items), then perhaps in the industry MSRP really is the base price. Options are just extras on top.

You're really reaching here. That "4" was probably next to a price right? They are saying that that specific price excludes options that you can add.

 

[Snow Drift]

Like all things with the IRS, it will likely put the onus on the filer to follow the rules. With the IRS then auditing some.


Even if they go that way "trim" does not equal base. There are three different VINs "trims" for the Model 3, and Model Y. So maybe they will go with that price and not worry about paint/wheels/interior/FSD. But that would still separate RWD, AWD, and Performance.


How would it not be easy to understand if they listed car models that meet the requirements and included an "and MSRP on Monroney under $50k." condition?


Nope. Destination charges are legally required to be the same for all destinations. (It can be different per model/factory, but for example the Model S comes from a single factory so the destination charge for anywhere in the US is required to be the same.) What is a destination charge? And do you have to pay them? | Autoblog



But we are all just guessing until formal guidance is issued at the end of the year.

I assume that yes, when you file, you are attesting to the car/VIN being eligible, of course. TurboTax isn't going to spit back your return bc it knows the price isn't eligible.

Yes, I meant they would separate by trim, not blanket approve all bc the RWD is cheap. Trim price = Base price for that trim. I don't mean MSRP of the stripper model. I mean RWD = $46,990 base MSRP. LR = $54,999 base MSPR. Performance = $62,990 (Not eligible). Usually VINs include digits which reference the trim.

You would confuse people. If I pick Basic Black I am eligible, if I get Crystal Black Pearl for $2,000, I am not eligible. Or you could just say all Model 3 LR AWD are eligible.

Subaru is unique, as their distributors are not all wholly-owned. They have different destination charges based on where you live. New England = Subaru of New England, NY/Northern NJ = Subaru Distribution Corp, Hawaii = Servco. They are independent of Subaru of America which sells cars to every other part of the US. They set their own Invoice price and Destination price.

 

[Snow Drift]

You're really reaching here. That "4" was probably next to a price right? They are saying that that specific price excludes options that you can add.

Yes, $30,000. The price they advertise for the Equinox to start at. That is the base price of the FWD 1LT model.

 

[MP3Mike]

I assume that yes, when you file, you are attesting to the car/VIN being eligible, of course. TurboTax isn't going to spit back your return bc it knows the price isn't eligible.

It would if the IRS made the MSRP another thing you have to provide along with the VIN, and TurboTax would check it against the requirements. It just isn't that complicated.

 

[Snow Drift]

It would if the IRS made the MSRP another thing you have to provide along with the VIN, and TurboTax would check it against the requirements. It just isn't that complicated.

We shall see.

 

[gglockner]

I can confirm that you can order new 2023 M3LR's from the existing inventory with pickup in Nov-Dec timeframe. I saw about 5 for my zip code and here is an example:

View attachment 861985

Yes, but I'm not finding any with:

1. White interior
2. FSD

Still, this is a promising sign that custom orders will reopen sooner or later.

 

[Snow Drift]

Yes, but I'm not finding any with:

1. White interior
2. FSD

Still, this is a promising sign that custom orders will reopen sooner or later.

I found 3 near me, with white interior. $60,490 (White w/ 19s or Black w/ 18s). When you click into the car you can add EAP and FSD.

 

[gglockner]

Thanks for the pointer about EAP/FSD. I figured that would be easy to add. I'm still not seeing white interior/19" wheels in my area, but I'll keep watching. I've got about 6 months until I need the car anyway.

 

[mjwojtukiewicz]

That's not how it was in the past, and that would get really complicated. Want floor mats and locking lug nuts? Premium paint color? This car came from the factory with mud flaps installed. Oh, sorry you're now at $55,000+, and not eligible. It is typically determined by the Base MSRP of the line (pre destination and options, for SR, LR and Performance).

Found this today

Because the federal tax credit is non-refundable, it can't be applied to your tax refund. So, the EV tax credit won't necessarily put money back in your pocket, but it might keep some there. For example, if your tax credit for your new electric car is $7500, but you only owe $3000 in taxes, you can only claim $3000 of the credit. This will prevent you from paying what you owe, but you won't get to take home a bigger refund.

So....if you make a decent salary (or salaries) and take to many deductions and you OWE money so the $7500 applied to how much you owe. So....make alot of money do 4 or 5 deductions and underpay your federal tax and you'll be able to use the $7500

 

[MP3Mike]

Found this today

Because the federal tax credit is non-refundable, it can't be applied to your tax refund. So, the EV tax credit won't necessarily put money back in your pocket, but it might keep some there. For example, if your tax credit for your new electric car is $7500, but you only owe $3000 in taxes, you can only claim $3000 of the credit. This will prevent you from paying what you owe, but you won't get to take home a bigger refund.

So....if you make a decent salary (or salaries) and take to many deductions and you OWE money so the $7500 applied to how much you owe. So....make alot of money do 4 or 5 deductions and underpay your federal tax and you'll be able to use the $7500

How much you OWE when you file doesn't matter. (Nor does it matter how much you had withheld.)

Your tax liability is what matters. If you made a lot, and had too much withheld you could be owed a $20k refund, and when you add an EV purchase that refund could go up to $27.5k. (Or higher if you purchased more than one EV.)

 

[mjwojtukiewicz]

How much you OWE when you file doesn't matter. (Nor does it matter how much you had withheld.)

Your tax liability is what matters. If you made a lot, and had too much withheld you could be owed a $20k refund, and when you add an EV purchase that refund could go up to $27.5k. (Or higher if you purchased more than one EV.)

That's not what I found. The $7500 decreases what you OWE. It does NOT increase your refund

 

[danarcha]

That's not what I found. The $7500 decreases what you OWE. It does NOT increase your refund

The tax credit is non-refundable meaning if your income is so low you don't have to pay federal income tax, you won't get $7500 more than what was withheld from your paychecks.

If for example, your tax liability is $20,000 and you had $30,000 withheld in taxes, you would normally get a refund of $10,000. With the $7500 credit, you would get a refund of $17,500 instead. If your tax liability is $20,000 and you had $10,000 withheld in taxes, instead of owing $10,000 you would owe $2500.

If your tax liability is less than $7500, the credit wipes out your tax liability but doesn't pay you the difference and you can't carry the extra credit over to future years. Anyone who can afford a Tesla will typically have more than $7500 in tax liability. I guess maybe if you had a business owner who had a huge business loss in a year, they might have a situation where their tax liability is less than $7500, but that generally only happens in very low income individuals.

 

[Snow Drift]

That's not what I found. The $7500 decreases what you OWE. It does NOT increase your refund

You are incorrect. The post above this is very helpful in explaining.

The non-refundable language doesn't mean you won't get a bigger check in April. I told you, I got a $12,000 check for my 2018 taxes.

Non-refundable means this:

If your Total Tax liability was only $5,000 for the year, then you can only use $5,000 of the credit and the remaining $2,500 is lost. The lost $2,500 is the non-refundable part. If the credit was "refundable" then any unused portion would also be paid to you.

If your Total Tax liability was $10,000 for the year, then you can use $7,500 of the credit, to offset it.

Total Tax is not what you necessarily what you owe in April. Most US tax payers either pay taxes on every paycheck (W2), they pay quarterly taxes or they pay it all in April. In April, if your Total Tax is $7,500 or more, you will get to use all of it. If you overpaid taxes during the year, then you will get a a refund. The credit is additional money in your refund check. If you happen to owe money, the credit will reduce that amount.

Look at your last year 1040 Line 24. Is that number bigger than $7,500?

Stop looking at line 34/35a (Refund), or 37 (Owed) it is unrelated to those.

 

[mjwojtukiewicz]

You are incorrect. The post above this is very helpful in explaining.

The non-refundable language doesn't mean you won't get a bigger check in April. I told you, I got a $12,000 check for my 2018 taxes.

Non-refundable means this:

If your Total Tax liability was only $5,000 for the year, then you can only use $5,000 of the credit and the remaining $2,500 is lost. The lost $2,500 is the non-refundable part. If the credit was "refundable" then any unused portion would also be paid to you.

If your Total Tax liability was $10,000 for the year, then you can use $7,500 of the credit, to offset it.

Total Tax is not what you necessarily what you owe in April. Most US tax payers either pay taxes on every paycheck (W2), they pay quarterly taxes or they pay it all in April. In April, if your Total Tax is $7,500 or more, you will get to use all of it. If you overpaid taxes during the year, then you will get a a refund. The credit is additional money in your refund check. If you happen to owe money, the credit will reduce that amount.

Look at your last year 1040 Line 24. Is that number bigger than $7,500?

Stop looking at line 34/35a (Refund), or 37 (Owed) it is unrelated to those.

I'll look.............

 

[T4M3]

Found this today

Because the federal tax credit is non-refundable, it can't be applied to your tax refund. So, the EV tax credit won't necessarily put money back in your pocket, but it might keep some there. For example, if your tax credit for your new electric car is $7500, but you only owe $3000 in taxes, you can only claim $3000 of the credit. This will prevent you from paying what you owe, but you won't get to take home a bigger refund.

So....if you make a decent salary (or salaries) and take to many deductions and you OWE money so the $7500 applied to how much you owe. So....make alot of money do 4 or 5 deductions and underpay your federal tax and you'll be able to use the $7500

As already posted by many but just to clarify with some formulas (this is assuming you qualify for the new EV tax credit which depends on the EV you purchase and your total adjusted gross income):

Without the EV tax credit in play, this is the typical general scenario:

Say you made X money in 2022 and your total calculated federal tax for 2022 turns out to be Y on your tax return for 2022. Say you already paid Z in taxes during the year (withheld from your paycheck for example).
1. If Z is greater than Y, then you overpaid for taxes during the year and you get a refund of Z minus Y from the IRS.
2. In case Z is less than Y, you underpaid your taxes and you owe the IRS a check in the amount of Y minus Z.

Now, with the tax credit, your refund check or the amount you still owe the IRS will change:

1. If Y is greater than or equal to $7500, the net tax benefit coming into your pocket will be $7500, i.e., your refund check will increase by $7500 or the tax you still owe the IRS is decreased by $7500, so regardless, your benefit is $7500.
2. If Y is less than $7500 then the net tax benefit coming to your pocket will be only Y which in this case is a number less than $7500. Say Y was $5000 to begin with, then your benefit is also only $5000. Please note that if Y was equal to zero to begin with (i.e., you did not owe any taxes to the IRS at all during 2022), then your benefit is also zero.