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Tax Credit and MY order/delivery

thanks much. So for 2023 I'd have to claim the credit when I file my federal tax at the end of the year and it wouldn't be applied by the dealer at the showroom. correct?
Point of sale for the MY starts in 2024, NOT 2023. 2023 is only tax credit that you claim off taxes. So people are thinking they can take the $7500 off the point of sale when they pick up their MY in 2023 are out for a rude awakening. That is fine b/c that means they are trying to delay and will delay their order which will make mine move up earlier which I am happy about!
 
Model Y is considered an SUV. No problems for the MY unless you order the MYP and FSD as that will push it over $80,000 at current pricing.

The vehicle most affected is the M3 LR and P models since they are both over the limit for their vehicle class.

As far as how Tesla handles it I think they will enforce what they are already doing.
 
Turns out this is not a forgone conclusion. As far as I know there is no official definition of what is an SUV and just because Tesla calls the Y an SUV may not be enough. What is to stop every car manufacturer from labeling their cars as SUVs? Remember we are now dealing with the IRS.

I'll bet that there isn't a state in the country that doesn't register the Model Y as an SUV. There is no reason for this kind of paranoia.
 
But like others have stated, the origin of the bulk of the battery is the remaining issue. Well, that, and the President hasn’t signed the bill as yet.
I believe that there are 2 different sentences concerning battery material sourcing instructions for the "Secretary". One says by 12/31/2022, the other says by 2024. Until the bill is signed and provisions explained a bit more clearly 2023 Model Y credits are hard to forecast.
 
Turns out this is not a forgone conclusion. As far as I know there is no official definition of what is an SUV and just because Tesla calls the Y an SUV may not be enough. What is to stop every car manufacturer from labeling their cars as SUVs? Remember we are now dealing with the IRS.
I believe the EPA determines this. My understanding is that EPA approval is needed before the vehicle can be brought to market. NHTSA classifies vehicles. No expert on this though I will say in Maryland the MY is registered as a Utility Vehicle.
 
Any accountants out there? I've searched around and can't seem to find any guidance on when a vehicle is "placed in service" per the bill. I'm expecting a MY sometime before year end and I'm wondering if I can take delivery and simply let it sit in my garage for a month before registering it with the DMV and "placing in in service" in Jan 2023 and taking the credit (whatever $ is ends up being) on my 2023 taxes.
 
Prior tax credits have gone by the year the vehicle was purchased, IIRC. Nothing to do with when it was registered or placed into service.

And yeah, I don't think there is any reason to worry about the Y being classified as an SUV for the purposes of this tax credit. The battery chemistry counting it out is more likely.
 
Prior tax credits have gone by the year the vehicle was purchased, IIRC. Nothing to do with when it was registered or placed into service.

And yeah, I don't think there is any reason to worry about the Y being classified as an SUV for the purposes of this tax credit. The battery chemistry counting it out is more likely.
Actually the current credit language is "placed in service". Date of sale or delivery is not mentioned. See attached.
 

Attachments

  • f8936.pdf
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  • i8936.pdf
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Not an accountant . Placed in service most likely means taking title of the vehicle or taking delivery. No way that I know of to take possession before either of these things. If you want a guarantee of the tax credit wait until after 1.1.2023 .
I will delay if Tesla will let me. My current EDD is 9/10-10/8. I don't think they're going to let me delay for 2+ months. But I'll try. Just trying to work the scenario where they force me to take delivery this year.
 
"Placed in service" doesn't need much guidance. You won't find anything that differs from the date that you take possession - ownership. You can't hide it from "service" to get around the provisions of the law.
I'm going to politely challenge that given some more research I did.

1. A little digging into IRS definitions/guidance:
  • Placed-in-service refers to when an asset is first placed in use for the purpose of accounting.
  • The placed-in-service date determines the point when depreciation begins or when a tax credit can be granted.
  • The date of purchase usually marks the placed-in-service date but is not necessarily the case.
2. I just found language in the current tax credit IRS form that outlines a scenario where the date acquired (possession) is different that the date placed in service. The scenario has to do with a change in vehicle certification status but it seems pretty clear to me that the date acquired and the date placed in service can be different.
 

nate704

Active Member
Apr 20, 2021
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Virginia
I will delay if Tesla will let me. My current EDD is 9/10-10/8. I don't think they're going to let me delay for 2+ months. But I'll try. Just trying to work the scenario where they force me to take delivery this year.
Tesla will not force you. If you ask for "hold" or "delay" they will say no, and they will give you two options. Take it or leave it.
 

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