Model S trade in vs sale for model 3, My experience this week

[hankinjax]

Just got my model 3. At $51k it is a good car. With the tax credit and final price around $43 it is phenomenal! I sold my model S. Tesla offered me $55k for my trade in. I sold it to an online company, Vroom.com for $69k. You are reading that right. Not only was it much more money it was incredibly easy. I did everything online. I did not even have to go to dealer. They came to the house to pick it up last night.

 

[Asymmetry]

Nice ad, needs pic of a bimbo on a telephone

 

[SBerg]

How were you paid the $69K?

 

[timk225]

As I understand it, a $7500 tax credit does not mean you are getting an extra $7500 back in your refund. It just reduces your taxable income by $7500, so however much of a difference in your refund that is.

EDIT - I looked up the IRS tax tables for married filing jointly. With the $7500 tax credit dropping taxable income from $62,500 to $55,000, that means an extra $1125 back in your refund.

So the $7500 tax credit is nowhere near as good as it sounds.

 

[N8Howell33]

As I understand it, a $7500 tax credit does not mean you are getting an extra $7500 back in your refund. It just reduces your taxable income by $7500, so however much of a difference in your refund that is.

EDIT - I looked up the IRS tax tables for married filing jointly. With the $7500 tax credit dropping taxable income from $62,500 to $55,000, that means an extra $1125 back in your refund.

So the $7500 tax credit is nowhere near as good as it sounds.

It is a credit meaning its a dollar for dollar reduction it is NOT a deduction (a percentage). The only way you wouldn't get the full credit is if you owed less that $7,500 in federal taxes.

 

[Zero CO2]

As I understand it, a $7500 tax credit does not mean you are getting an extra $7500 back in your refund. It just reduces your taxable income by $7500, so however much of a difference in your refund that is.

EDIT - I looked up the IRS tax tables for married filing jointly. With the $7500 tax credit dropping taxable income from $62,500 to $55,000, that means an extra $1125 back in your refund.

So the $7500 tax credit is nowhere near as good as it sounds.

credit means a credit against what you owe in federal taxes ... what you describe above is a deduction

 

[Phillyasian]

As I understand it, a $7500 tax credit does not mean you are getting an extra $7500 back in your refund. It just reduces your taxable income by $7500, so however much of a difference in your refund that is.

EDIT - I looked up the IRS tax tables for married filing jointly. With the $7500 tax credit dropping taxable income from $62,500 to $55,000, that means an extra $1125 back in your refund.

So the $7500 tax credit is nowhere near as good as it sounds.

That's not right. It's a direct credit. That's why there's always the discussion that you need to have a tax liability of $7500 in order to get the full advantage. IF for example your Federal Tax liability is only $5,000 you will only get $5000 worth of the credit and you lose the other $2500. It doesn't carry forward nor do you get a check .

 

[deonb]

As I understand it, a $7500 tax credit does not mean you are getting an extra $7500 back in your refund. It just reduces your taxable income by $7500, so however much of a difference in your refund that is.

EDIT - I looked up the IRS tax tables for married filing jointly. With the $7500 tax credit dropping taxable income from $62,500 to $55,000, that means an extra $1125 back in your refund.

So the $7500 tax credit is nowhere near as good as it sounds.

Not correct. I've taken this twice before. It reduced my taxes due, not just my taxable income, by $7500 each time.

 

[TexasEV]

As I understand it, a $7500 tax credit does not mean you are getting an extra $7500 back in your refund. It just reduces your taxable income by $7500, so however much of a difference in your refund that is.

There’s your problem— you don’t understand what a tax credit is.