Sick of waiting? Vent here

[Lem89]

The problem with people who were worried that the car that SHOULD have been weeks away is now MONTHS away - and are afraid of the tax credit running out and THAT was making the car affordable...

How were you going to afford the car payments between now and 2018 when you file your taxes?

I mean, that's the situation I'm in - hunting for the best loan deal, trying to figure out how much money I've saved will go towards the down payment and how much will have to go towards other one-off costs (like the huge registration bill I'll have, etc).

I have to make sure that I can afford the monthly payments for nearly a year before I see that $7500. And even then, I could put the whole $7500 towards the loan, but that will only cut my number of car payments, not the payment amount.

You don't get a check for $7500. The money comes from not having to pay $7500 taxes if you owe that much. It can be planned over the course of a year to withhold less tax from paychecks (keeping in mind underpayment) and so afford a higher car payment until it's time to file, then offsetting the taxes owed with the credit.

 

[Runt8]

What?

Who said anything about withholdings? I didn't say that if you can't afford a higher priced item, then you can't also afford a lower priced one? I didn't mention having a job to have a withholding to adjust. One could be retired or living on welfare - a bank robber or who knows.

I didn't mention any of that.

What?If you can't afford a Car...then you shouldn't buy it. That's it. If you can't afford a car "like a model 3" then a tax rebate won't make you able to afford it. The car is in the $40k - $60k range right now. A $7500 credit rebate ( RECEIVED NEXT YEAR) won't do anything concerning monthly payments right now. That's my point.

Are you being deliberately obtuse? I understood your posts just fine, and I think they're wrong (hence disagreeing). As many people have explained, its very simple to take the tax credit into account throughout the year by adjusting withholdings instead of waiting until you file. Making something less expensive (regardless of how it's accomplished) by definition makes it more affordable.

 

[Garlan Garner]

Are you being deliberately obtuse? I understood your posts just fine, and I think they're wrong (hence disagreeing). As many people have explained, its very simple to take the tax credit into account throughout the year by adjusting withholdings instead of waiting until you file. Making something less expensive (regardless of how it's accomplished) by definition makes it more affordable.

There are no many people disagreeing. That's just not true at all.

I want you to show me how you are making the car less expensive. Show me how you are going to make your invoice cheaper.

You are talking about this like everyone has a job. For example: There are plenty of retirees buying Model 3's because of the price and CAN"T adjust withholdings and everything you are brining up. They can't adjust their income. ITS FIXED.
You can rob a bank and make it more affordable.

Again....for any young people reading this. Transportation may be necessary these days, however if you have to adjust your life to get one that you can't naturally afford...Please think twice.
Changing your withholdings just to get more money for a "luxury" ISN'T what any financial advisor or parent should ever suggest.

Withdrawing from a 401K for something like a model 3 is also not a good idea....maybe borrowing from it and paying yourself back the interest could be considered, but shouldn't be a kneejerk reaction. There are huge tax implications withdrawing early from a 401K. Borrowing from a 401K and getting surpluses also causes money you haven't paid yourself back to automatically become a withdrawal and there the same tax implications occur.

Lastly and back to the topic about this rebate.....It will not make a difference at all during your time of purchase. Robing Peter to pay Paul is NOT a great idea especially when you are talking about a "non essential" item such as a car like a model 3. There are thousands of alternatives that won't cause you to have to adjust your life for a thing like a car.

The above message is for young people.

Some not-so-good decisions take 3 times as long to correct.

As much as I absolutely love the Model 3.....it will never become a necessity that I will adjust my life and my families life around.

 

[Runt8]

There are no many people disagreeing. That's just not true at all.

I want you to show me how you are making the car less expensive. Show me how you are going to make your invoice cheaper.

You are talking about this like everyone has a job. For example: There are plenty of retirees buying Model 3's because of the price and CAN"T adjust withholdings and everything you are brining up. They can't adjust their income. ITS FIXED.

They are paying taxes, otherwise they can't make use of the tax credit. So pay less taxes, however they do that based on their situation.

I never said the invoice price would change.

 

[spacemnspiff]

I just received an email about delivery timing adjusted to a 'slightly' later window. That 'slightly' went from an 'optimistic' Feb 2018 to Early 2019 over a period of few months. What a bummer.

 

[Garlan Garner]

They are paying taxes, otherwise they can't make use of the tax credit. So pay less taxes, however they do that based on their situation.

I never said the invoice price would change.

So the term "making the car cheaper" is not the term to use because no one can.

So the term "Making it more affordable" is where we are. It depends on what you are talking about doing. Rob a bank. Cheat. or whatever. However changing withholdings WILL NOT get you more money for a given year.

Look. Sure you can change your withholdings, however it won't change how much taxes you pay. Sure from month to month you pay less taxes and get more money in your pocket, however come tax time..........you will be paying the IRS a LOT MORE than you would have.

In other words....for the young people......

You will pay the same amount of taxes at the end of the year NO MATTER WHAT if you change your withholdings. You can choose to pay less per month and owe at the end of the year.....OR you can pay each month what you owe and have nothing to pay at the end of the year. YOU will have to decide that for yourself when you get a job.

I would just hate for young people to think that they are going to pay less TOTAL taxes by changing their withholdings.

Can you imagine a kid running home to mom and dad and saying: I read on the Tesla Model 3 forum that you can change your withholdings on your job and get more money. Really? Truly?

 

[atlas310]

So the term "making the car cheaper" is not the term to use because no one can.

So the term "Making it more affordable" is where we are. It depends on what you are willing to do. Rob a bank. Cheat. or whatever.

Look. Sure you can change your withholdings, however it won't change how much taxes you pay. Sure from month to month you pay less taxes and get more money in your pocket, however come tax time..........you will be paying the IRS a LOT MORE than you would have.


I would just hate for young people to think that they are going to pay less TOTAL taxes by changing their withholdings.

Huh? The idea is you're adjusting your withholdings so that the amount of taxes you'd end up having to pay is offset by the tax credit, thereby not having to pay it. Obviously, there are certain situations where it doesn't help because an individual doesn't earn enough, but for the most part, if you're paying taxes and you get the tax credit, the net affect is less money out of pocket. It may not be immediate, but in the end, the car is less.

 

[Garlan Garner]

Huh? The idea is you're adjusting your withholdings so that the amount of taxes you'd end up having to pay is offset by the tax credit, thereby not having to pay it. Obviously, there are certain situations where it doesn't help because an individual doesn't earn enough, but for the most part, if you're paying taxes and you get the tax credit, the net affect is less money out of pocket. It may not be immediate, but in the end, the car is less.

I understand that. But you aren't ultimately getting any additional money. All you are doing is spreading out the rebate across the months until the next tax year. Then you are back to normal after the 1st year. I get it.

The car is NOT cheaper. You will pay less per month because of the rebate until the tax time. Then you will have to make yet another decision.

And again. Its a tax credit not a refund. Your taxable income will go down. You don't get a $7500 check as far as I understand it.

Let me ask a question: If you lowered your income by $7500.....do you receive $625 per month?

 

[atlas310]

I understand that. But you aren't ultimately getting any additional money. All you are doing is spreading out the rebate across the months until the next tax year. Then you are back to normal after the 1st year. I get it.

The car is NOT cheaper. You will pay less per month because of the rebate until the tax time. Then you will have to make yet another decision.

And again. Its a credit not a refund. Your taxable income will go down. You don't get $7500 as far as I understand it.

No. It's a tax credit. Not a tax deduction. If at the end of the year, your tax liability is $8500, the credit knocks that down to a $1000 liability.

 

[bthienthai]

Jesus Christ. You guys can go at it until the cows come home and it still won't be settled. The point everybody is trying to make is, instead of paying uncle Sam, say 20k in tax, you're paying 20k - 7.5k = 12.5k. So, it's equivalent to receiving 7.5k, because if you're not buying the car, that 7.5k will go to uncle Sam. So, ultimately, that actually makes the car cheaper. Whether you get the tax money now or later doesn't really matter. If anyone can't see that, I suggest you buy a bicycle.

 

[TT97]

I understand that. But you aren't ultimately getting any additional money. All you are doing is spreading out the rebate across the months until the next tax year. Then you are back to normal after the 1st year. I get it.

The car is NOT cheaper. You will pay less per month because of the rebate until the tax time. Then you will have to make yet another decision.

And again. Its a tax credit not a refund. Your taxable income will go down. You don't get a $7500 check as far as I understand it.

Let me ask a question: If you lowered your income by $7500.....do you receive $625 per month?

Increasing your allowances doesn't lower your income, it lowers the amount of taxes withheld from your paycheck. IT DOES NOT CHANGE YOUR TAX OBLIGATION AT YEAR END. My personal goal is to break-even when I file - I don't want a big check back and definitely don't want to owe money when I file. It is much easier said than done. As far as the $7,500, I am expecting to get something but am not adjusting my allowances so I do expect to get back money in 2019 (but with the new tax laws, I have no clue what that will be).

The $7,500 rebate does make the car cheaper (by about $6,750 since I still have to pay sales tax/registration on the entire amount). There is definitely a time of money issue involved, but you can't say that it makes no difference if you get the rebate vs not getting the rebate. I could afford the car with or without the rebate but I am not comfortable spending so much on a car if it wasn't for the Federal and State rebates.

Again, I would recommend talking to your financial adviser or accountant and not go based on advise from a Tesla forum.

 

[Runt8]

So the term "making the car cheaper" is not the term to use because no one can.

So the term "Making it more affordable" is where we are. It depends on what you are talking about doing. Rob a bank. Cheat. or whatever. However changing withholdings WILL NOT get you more money for a given year.

Look. Sure you can change your withholdings, however it won't change how much taxes you pay. Sure from month to month you pay less taxes and get more money in your pocket, however come tax time..........you will be paying the IRS a LOT MORE than you would have.

In other words....for the young people......

You will pay the same amount of taxes at the end of the year NO MATTER WHAT if you change your withholdings. You can choose to pay less per month and owe at the end of the year.....OR you can pay each month what you owe and have nothing to pay at the end of the year. YOU will have to decide that for yourself when you get a job.

I would just hate for young people to think that they are going to pay less TOTAL taxes by changing their withholdings.

Can you imagine a kid running home to mom and dad and saying: I read on the Tesla Model 3 forum that you can change your withholdings on your job and get more money. Really? Truly?

Thank you for yet another straw man argument. If you want to change the scenario so that the EV tax credit no longer applies, then yes, you will owe the same amount of taxes regardless of whether you pay monthly, quarterly, or yearly (actually, you will owe more if try to pay it all at the end of the year, but I digress...).

In the context of this discussion, I think it's fair to say that the person in question has purchased a Model 3 and is eligible for the tax credit. In this case, you do owe less taxes. So instead of paying the "normal" amount of taxes during the year and then waiting for a large refund check after you file, you pay less during the year. You end up with more money in your pocket - which can be used to offset the larger monthly car payment.

In terms of the actual amount of money you pay for the car, it is cheaper and more affordable.

And holy crap, I fell down the rabbit hole again, trying to have rational discourse with Garlan Garner. I'm out.

 

[nvx1977]

the facts:

- the tax credit can only offset taxes owed. If you owe no taxes (rare situation), you cannot claim the credit. You also cannot carry over unused credit to future tax years. Source, line 23

- you get the tax credit after you file your taxes. If you don't reduce withholdings, your refund will be larger.

- if you do reduce withholdings, you get to pocket more per paycheck. And after you file for the credit, your refund will be smaller. This may be advantageous for people who could use more upfront $$ to pay for the car. The amount you withhold does not affect your overall tax liability - just who holds on to your money, you or uncle sam.

- the credit does save you money (assuming you had enough tax liability for it to apply), but adjusting withholdings only changes whether you or uncle sam holds on to your money during the tax year. The net savings is the same.

-be aware that under-withholding can possibly trigger a penalty; uncle sam really doesn't like it when you hold on to the money you will owe for taxes.

 

[Big-T]

Man first it was the Republicans wanting to slash the $7,500 tax credit (it stayed), then it was my state hitting it's limit for a tax exemption (looks like they'll extend it) - now it's looking like Tesla itself may not get me a car fast enough to take advantage of the tax savings. To add to that, I may now have to put some extra cash in my old car before things break on it completely......This roller coaster is just disheartening.

I'm a very mainstream shopper who is stretching a bit to get this car, without the tax incentives I won't get it. I realize that doesn't describe many in this forum but it does describe many of the hundreds of thousand reservation holders that don't frequent this forum.

If Tesla doesn't watch out they're going to ramp production just at the same time folks start turning away en masse

 

[sreams]

If Tesla doesn't watch out they're going to ramp production just at the same time folks start turning away en masse

This would likely never be the case. Let's say that -every- reservation- holder cancelled today. Suddenly there would be no backlog, and I bet Tesla would sell every car they could produce as a result. Just walk in to a Tesla store and drive it away.

 

[bthienthai]

This would likely never be the case. Let's say that -every- reservation- holder cancelled today. Suddenly there would be no backlog, and I bet Tesla would sell every car they could produce as a result. Just walk in to a Tesla store and drive it away.

Yes, but that would put them in trouble, wouldn't it? Having no waiting customers for your product can suck big time. Ask the guy who makes Bolt, and he'd tell you. By the way, whoever designed that car should be sentenced to walking to work for 5 years. I mean, good God. I'd rather take an Uber to work than being seen in driving that thing.

 

[MarcusMaximus]

It sounds reasonable on first thought, but if your current delivery is early 2019, then for TSLA to make that date they are expecting 5k/week production. If they do meet that goal, then difference between you and new reservation in 2019 will be at most few months (assuming US orders have higher priority).

400k preorders / (5k / week) = 80 weeks = 1.5 years. And they won't hit 5k/week until at least the end of Q2. If you cancel your preorder and then order later, you're going to be waiting until at least 2020 for that car.

 

[YauKwan]

Throwing some gas on this fire.

There’s over 150k owners of X and S vehicles sold. If each owner purchases a 3. There won’t be any tax credit remaining. Not to mention how many Tesla employees also took deliveries.

The least expensive 3 will be a $35,000 car. If it’s beyond what you typically will pay and will put a hardship on finances, don’t buy the car. It’s just a car.

 

[Garlan Garner]

Increasing your allowances doesn't lower your income, it lowers the amount of taxes withheld from your paycheck. IT DOES NOT CHANGE YOUR TAX OBLIGATION AT YEAR END. My personal goal is to break-even when I file - I don't want a big check back and definitely don't want to owe money when I file. It is much easier said than done. As far as the $7,500, I am expecting to get something but am not adjusting my allowances so I do expect to get back money in 2019 (but with the new tax laws, I have no clue what that will be).

The $7,500 rebate does make the car cheaper (by about $6,750 since I still have to pay sales tax/registration on the entire amount). There is definitely a time of money issue involved, but you can't say that it makes no difference if you get the rebate vs not getting the rebate. I could afford the car with or without the rebate but I am not comfortable spending so much on a car if it wasn't for the Federal and State rebates.

Again, I would recommend talking to your financial adviser or accountant and not go based on advise from a Tesla forum.

I received my advise from the accountant of my company. He informed me that its a tax credit....and that it follows all of the rules as a donated car. Its not a rebate.

I'm not sure why you think I'm getting information from this forum. If I were.....I wouldn't disagree with anyone.

 

[Garlan Garner]

Throwing some gas on this fire.

There’s over 150k owners of X and S vehicles sold. If each owner purchases a 3. There won’t be any tax credit remaining. Not to mention how many Tesla employees also took deliveries.

The least expensive 3 will be a $35,000 car. If it’s beyond what you typically will pay and will put a hardship on finances, don’t buy the car. It’s just a car.

The further Tesla pushes out deliveries of the 3's the less chance each reservationist has. Tesla's 200K count will certainly be surpassed by the time that I get my 3 late this year.

All of the well-to-do folks will have exhausted it.