Tax credit 2024 [The tax credit discussion thread]

[Skavatar]

same with ours, its in addition to the car's price.

 

[JWhite65]

The $250 reservation fee is not credited toward the vehicle price. If you buy a vehicle which costs $48,000, then you will pay $48,250 plus other fees and taxes. Here's my purchase agreement. You'll see they added the $250 to the purchase price, then gave credit for the $250 paid. You do pay taxes on the order fee, just like on the destination fee. This is in Texas, may be different in other States.

View attachment 1010979

View attachment 1010980

Seems to me line 5B credits the $250 order fee. In this case, you paid $250 to order, then $53,956.88 at pickup for a total of $54,206.88. Am I reading something wrong?

 

[Alonzo]

Seems to me line 5B credits the $250 order fee. In this case, you paid $250 to order, then $53,956.88 at pickup for a total of $54,206.88. Am I reading something wrong?

In the top section, the $250 was added to the vehicle price and the destination charge to get the total price of the vehicle of $50,630. Then, taxes and registration fees were calculated on that amount for a total of $54,206.88. Then, they gave me credit for what I had paid, $250 in advance and $53,956.88.

The $250 was credited toward the total price of the vehicle, which included the $250 order fee. It was not credited toward the $48,990 advertised price of the vehicle. Yes, I was credited for paying the $250, but only toward the $250 fee which was added on to the vehicle price.

 

[JWhite65]

In the top section, the $250 was added to the vehicle price and the destination charge to get the total price of the vehicle of $50,630. Then, taxes and registration fees were calculated on that amount for a total of $54,206.88. Then, they gave me credit for what I had paid, $250 in advance and $53,956.88.

The $250 was credited toward the total price of the vehicle, which included the $250 order fee. It was not credited toward the $48,990 advertised price of the vehicle. Yes, I was credited for paying the $250, but only toward the $250 fee which was added on to the vehicle price.

Gotcha. I missed it in the top section.

 

[NewUser12345]

Quick question everyone.
I bought a tesla model y 2023 i am using turbo tax. when i fill in the vehicle information number and date of service it says i qualify for 3500, not the the 7500.
We are a family of 4 with an agi of 59k

 

[mongo]

Quick question everyone.
I bought a tesla model y 2023 i am using turbo tax. when i fill in the vehicle information number and date of service it says i qualify for 3500, not the the 7500.
We are a family of 4 with an agi of 59k

Y qualified for the full $7,500 crefit all last year (assuming MSRP under $55k). However, the credit is not refundable. Is $3,500 your total tax liability?

 

[Skavatar]

was it new or used? all new 2023 Y should be $7500.

 

[ucmndd]

We are a family of 4 with an agi of 59k

I highly doubt you have $7,500 or more of tax liability.

 

[NewUser12345]

was it new or used? all new 2023 Y should be $7500.

new

 

[NewUser12345]

Y qualified for the full $7,500 crefit all last year (assuming MSRP under $55k). However, the credit is not refundable. Is $3,500 your total tax liability

i believe so

 

[mongo]

i believe so

It seems like TurboTax is doing the right thing then.

 

[ucmndd]

i believe so

The credit is not refundable, so it only offsets liability to the extent that you have it. If your tax liability for the year is only $3500 (which is a reasonable estimate given your income and family size), then that’s all you’ll get.

 

[vickh]

The credit is not refundable, so it only offsets liability to the extent that you have it. If your tax liability for the year is only $3500 (which is a reasonable estimate given your income and family size), then that’s all you’ll get.

This is why I like this year's point of sale system everything gets check up front at the point of sale I believe. Unless it gets reconciled later too?

 

[ucmndd]

This is why I like this year's point of sale system everything gets check up front at the point of sale I believe. Unless it gets reconciled later too?

With the 2024 POS credit they’ve decided they won’t hunt down people without enough tax liability to recoup the difference - effectively making the credit refundable.

Upper income limits do still apply - if you take the POS credit and are above the income cap they WILL take it back from you.

 

[mongo]

With the 2024 POS credit they’ve decided they won’t hunt down people without enough tax liability to recoup the difference - effectively making the credit refundable.

Upper income limits do still apply - if you take the POS credit and are above the income cap they WILL take it back from you.

It's not a matter of the IRS being nice and not hunting you down, yhe point of sale credit is classified differently in the actual legislation and there is nothing for them to hunt you down for. (Other than exceeding the income limit, but that is covered in the law also.)

 

[jeffkruse]

i believe so

Maybe you can convert a IRA to a Roth IRA to bump up your tax responsibility for 2023.

 

[ucmndd]

It's not a matter of the IRS being nice and not hunting you down, yhe point of sale credit is classified differently in the actual legislation and there is nothing for them to hunt you down for. (Other than exceeding the income limit, but that is covered in the law also.)

Semantics… outcome is the same. The credit has effectively become refundable.

I think that’s a good thing.

 

[vickh]

With the 2024 POS credit they’ve decided they won’t hunt down people without enough tax liability to recoup the difference - effectively making the credit refundable.

Upper income limits do still apply - if you take the POS credit and are above the income cap they WILL take it back from you.

ahh Good info! I was good with the upper-end income limit last year.

Sounds like the reporting process is still similar between the 2 years. I thought it would be easier to get the POS. They do the SSN check, then the onus is on TSLA/dealer/ IRS portal

 

[NewUser12345]

It seems like TurboTax is doing the right thing then.

that one time we need turbotax to mess up lol Thank you all

 

[vickh]

that one time we need turbotax to mess up lol Thank you all

I would look into IRA to Roth conversions like someone mentioned. It would be a freebie until $3K+ in taxes for you. Talk to a real CPA and not just TT this year.