Model 3 Tax Credit

[bdice18]

If I were to pick up my Model 3 on June 25th, and I paid, for example, $3,000 in federal taxes. Would I receive the $3,000 in tax credit, or would I not get any of it? Because in that case, I think it would be better to wait until July.

 

[Wampa]

Yes you can get up to $3500 back depending on how much you owe the feds. If you owed $10,000 you would get $3500. If you owed $3000 you would get $3000 back.

 

[OCR1]

But you really should try to use the entire credit if you can. If you have any money in a traditional IRA you can convert it to a Roth IRA to generate additional taxable income to fill in the gap. It’s free money so try to use the entire amount if possible.

 

[bdice18]

Yes you can get up to $3500 back depending on how much you owe the feds. If you owed $10,000 you would get $3500. If you owed $3000 you would get $3000 back.

Are you sure on this?

 

[OCR1]

Are you sure on this?

Yes, that statement is correct. What is your concern?

 

[hmgolds]

I don't understand why waiting until July to take delivery would make a difference. The credit applies to taxes paid during the entire year.

 

[bdice18]

I don't understand why waiting until July to take delivery would make a difference. The credit applies to taxes paid during the entire year.

I thought that you could only get $3750, no more, no less, but I have been corrected, so that statement is redacted

 

[TJtv]

Yes you can get up to $3500 back depending on how much you owe the feds. .

$3500 is wrong. The correct amount is $3750 if you take delivery by end of Q2.

 

[dmurphy]

To be clear, the credit is applied against your entire 2019 tax liability. It’s not about how much tax you’ve paid or not by 6/30. You’ll get it as a credit against your 1040 form when you file it in early 2020.

Also, to clear up a misconception - it has nothing to do with whether you owe the IRS, or get a refund when you file. It’s only about what your tax liability was for all of 2019.

 

[gobble]

It's a nonrefundable credit meaning you can credit up to $3,750 off your 2019 federal tax liability (not payments or refund but tax liability). If you have no tax liability you have nothing to reduce.

 

[gobble]

Wow posted same thing at the same time

 

[Agie]

If I sell the model 3 before the end of the year 2019, can I still claim a tax credit?
I purchased it in the beginning year of 2019. Does anyone know the answer?

 

[MorrisonHiker]

If I sell the model 3 before the end of the year 2019, can I still claim a tax credit?
I purchased it in the beginning year of 2019. Does anyone know the answer?

Yes. For the federal tax credit, you can buy it and resell it. There is a stipulation that you can't apply for the tax credit if you bought the car knowing you were going to sell it. Seeing as you owned it several months, it shouldn't be an issue. We've claimed the federal tax credit 10 times over the last 3 years and have already sold 5 of those vehicles.

 

[Agie]

Yes. For the federal tax credit, you can buy it and resell it. There is a stipulation that you can't apply for the tax credit if you bought the car knowing you were going to sell it. Seeing as you owned it several months, it shouldn't be an issue. We've claimed the federal tax credit 10 times over the last 3 years and have already sold 5 of those vehicles.

So I don't have to wait until I file the tax return? Thanks.

 

[MorrisonHiker]

So I don't have to wait until I file the tax return? Thanks.

Nope. When you fill out the form, it just asks you for the VIN and a few other pieces of information. You can see last year's form here but if you file online with tax software, it might ask you things differently. It never asks if you've sold it.

 

[Tigerkc]

The tax credit is not based on how much Federal tax you have paid, but what is your tax liability