Tesla EV Tax Credits coming back?

[MR52]

Wondering if this is impactful, there appear to be caps based on vehicle type. Wonder how tesla officially classifies their cars. If I am reading correctly sounds like the Y and X might be in limitations but if the S, 3 are classified as cars do they fall in other and not qualify? from page 377 of the bill:

‘‘(B) APPLICABLE LIMITATION.—For purposes of subparagraph (A), the applicable limitation for each vehicle classification is as follows: 14 ‘‘(i) VANS.—In the case of a van, 15 $80,000. 16 ‘‘(ii) SPORT UTILITY VEHICLES.—In the case of a sport utility vehicle, $80,000. 18 ‘‘(iii) PICKUP TRUCKS.—In the case of a pickup truck, $80,000. ‘‘(iv) OTHER.—In the case of any other vehicle, $55,000.

 

[johnnycnote]

Tesla will increase prices by another $7,500 now

 

[BarryC7]

Where does it say that in the bill?

The effective date paragraph is on page 398 of the bill. It says the tax credit section applies to vehicles acquired after December 31, 2022.

 

[citivolus]

On page 386:

https://www.democrats.senate.gov/imo/media/doc/inflation_reduction_act_of_2022.pdf

But there is something about December 31, 2021 as well. Probably it is about vehicles that are currently eligible for credit, but not sure.

The effective date paragraph is on page 398 of the bill. It says the tax credit section applies to vehicles acquired after December 31, 2022.

This wording on page 386 does seem to imply some special treatment for cars bought in 2022:

(l) TRANSITION RULE.—Solely for purposes of the application of section 30D of the Internal Revenue Code of 1986, in the case of a taxpayer that—
(1) after December 31, 2021, and before the date of enactment of this Act, purchased, or entered into a written binding contract to purchase, a new qualified plug-in electric drive motor vehicle (as de-fined in section 30D(d)(1) of the Internal Revenue Code of 1986, as in effect on the day before the date of enactment of this Act), and
(2) placed such vehicle in service on or after the date of enactment of this Act,
such taxpayer may elect (at such time, and in such form and manner, as the Secretary of the Treasury, or the Sec- retary’s delegate, may prescribe) to treat such vehicle as having been placed in service on the day before the date of enactment of this Act.

 

[bro1999]

Tesla will increase prices by another $7,500 now

I just put in an order for a MYLR-7 just in case...

 

[BarryC7]

This wording on page 386 does seem to imply some special treatment for cars bought in 2022:

(l) TRANSITION RULE.—Solely for purposes of the application of section 30D of the Internal Revenue Code of 1986, in the case of a taxpayer that—
(1) after December 31, 2021, and before the date of enactment of this Act, purchased, or entered into a written binding contract to purchase, a new qualified plug-in electric drive motor vehicle (as de-fined in section 30D(d)(1) of the Internal Revenue Code of 1986, as in effect on the day before the date of enactment of this Act), and
(2) placed such vehicle in service on or after the date of enactment of this Act,
such taxpayer may elect (at such time, and in such form and manner, as the Secretary of the Treasury, or the Sec- retary’s delegate, may prescribe) to treat such vehicle as having been placed in service on the day before the date of enactment of this Act.

I hope you're right, but this is what I found on page 398:

(3) The table of sections for subpart D of part 4 IV of subchapter A of chapter 1, as amended by the preceding provisions of this Act, is amended by adding at the end the following new item: ‘‘Sec. 45W. Qualified commercial clean vehicle credit.’’. c) EFFECTIVE DATE.—The amendments made by this section shall apply to vehicles acquired after December 31, 2022.

 

[citivolus]

This wording on page 386 does seem to imply some special treatment for cars bought in 2022:

(l) TRANSITION RULE.—Solely for purposes of the application of section 30D of the Internal Revenue Code of 1986, in the case of a taxpayer that—
(1) after December 31, 2021, and before the date of enactment of this Act, purchased, or entered into a written binding contract to purchase, a new qualified plug-in electric drive motor vehicle (as de-fined in section 30D(d)(1) of the Internal Revenue Code of 1986, as in effect on the day before the date of enactment of this Act), and
(2) placed such vehicle in service on or after the date of enactment of this Act,
such taxpayer may elect (at such time, and in such form and manner, as the Secretary of the Treasury, or the Sec- retary’s delegate, may prescribe) to treat such vehicle as having been placed in service on the day before the date of enactment of this Act.

I just re-read this a little more carefully and believe that the section I quoted basically allows a taxpayer who bought an EV after this bill goes into law to choose the "old" EV credit as opposed to this "new" proposed credit if they so desire. We're screwed

 

[bro1999]

I just re-read this a little more carefully and believe that the section I quoted basically allows a taxpayer who bought an EV after this bill goes into law to choose the "old" EV credit as opposed to this "new" proposed credit if they so desire. We're screwed

Rivian may also be screwed too with the US-minimum content/made stipulations of the bill.

 

[ohmman]

Why? Do people above a certain income/ cars above a certain price point have a lower carbon footprint?

Seems to me if the goals with electrification of the automobile/truck/semi fleet are (1) lower carbon footprint (2) increase EV adoption then neither income or car price are relevant to these goals.

I think it's more about the value proposition. Financial incentives become (statistically) less effective as wealth increases. Capping the income level just ensures that the government is getting the most value out of the revenue loss as far as incentivizing EV adoption.

 

[evseeker]

Those who get their vehicles before December 31, 2022 are not entitled to the $7,500 tax credit. We should call our senators/congressman to do a fix this is available after date of enactment. That way, those who get the delivery till the year end can get the credit. Ideally, it should apply to all those who purchased in 2022. Not sure legislation would go retrospective that easily.

 

[bro1999]

There's no way Tesla does NOT jack up prices if this passes, correct? Otherwise tons of people will happily eat the $250 order fee, get out of line and just plop down another $250 when they're reasonably sure their car won't be ready for delivery till next year and can claim the $7,500 credit (POS rebate?) whatever it ends up being.

 

[Tam]

Wondering if this is impactful, there appear to be caps based on vehicle type. Wonder how tesla officially classifies their cars. If I am reading correctly sounds like the Y and X might be in limitations but if the S, 3 are classified as cars do they fall in other and not qualify? from page 377 of the bill:

‘‘(B) APPLICABLE LIMITATION.—For purposes of subparagraph (A), the applicable limitation for each vehicle classification is as follows: 14 ‘‘(i) VANS.—In the case of a van, 15 $80,000. 16 ‘‘(ii) SPORT UTILITY VEHICLES.—In the case of a sport utility vehicle, $80,000. 18 ‘‘(iii) PICKUP TRUCKS.—In the case of a pickup truck, $80,000. ‘‘(iv) OTHER.—In the case of any other vehicle, $55,000.

S an 3 are sedans subject to maximum price of $55,000

X and Y are SUV and subject to a maximum price of $80,000.

S and X are above the maximum prices so they are disqualified.

If you budget your 3 and Y, you can qualify.

You can exceed maximum price due to an option.

3 Performance $62,999=exceeded maximum price.

Y Performance $69,990+FSD $12,000=$81,990=exceeded maximum price.

 

[h2ofun]

S an 3 are sedans subject to maximum price of $55,000

X and Y are SUV and subject to a maximum price of $80,000.

S and X are above the maximum prices so they are disqualified.

If you budget your 3 and Y, you can qualify.

You can exceed maximum price due to an option.

3 Performance $62,999=exceeded maximum price.

Y Performance $69,990+FSD $12,000=$81,990=exceeded maximum price.

whats the income level?

 

[randmness]

whats the income level?

Adjusted gross income limit of $150k for individuals, $225k for head of household, and $300k for joint returns.

We preordered a Model Y earlier this year that isnt due to be delivered til April 2023. I hope Tesla does not make any production speed improvements between now and the end of the year.

I wonder if the foreign EV manufacturers will open up ordering ASAP? If you order this year (prior to this bill being signed), for a delivery in 2023, you could potentially still get the current fed credit (assuming they havent met the sales cap for the credit.)

 

[MP3Mike]

There's no way Tesla does NOT jack up prices if this passes, correct? Otherwise tons of people will happily eat the $250 order fee, get out of line and just plop down another $250 when they're reasonably sure their car won't be ready for delivery till next year and can claim the $7,500 credit (POS rebate?) whatever it ends up being.

That depends. Their order may already be more than $7,500 less than the current price if they place a new order.

 

[youscott]

S an 3 are sedans subject to maximum price of $55,000

X and Y are SUV and subject to a maximum price of $80,000.

S and X are above the maximum prices so they are disqualified.

If you budget your 3 and Y, you can qualify.

You can exceed maximum price due to an option.

3 Performance $62,999=exceeded maximum price.

Y Performance $69,990+FSD $12,000=$81,990=exceeded maximum price.

Do you know if the car price has to be under $55,000 including the destination & doc fee + order fee?
Example: my friend has a M3LR vehicle price at 54k, but after destination & doc fee and order fee it brings him above $55,000.

 

[Mockingbird]

Don't worry.

Tesla will increase prices by another $7,500.

 

[Tam]

Do you know if the car price has to be under $55,000 including the destination & doc fee + order fee?
Example: my friend has a M3LR vehicle price at 54k, but after destination & doc fee and order fee it brings him above $55,000.

Usually, when the price is quoted in incentives, it's the MSRP excluding other fees and taxes.

 

[Haste]

The exclusion of the LR and P really stinks, oh well.

 

[ZenRockGarden]

The exclusion of the LR and P really stinks, oh well.

One strategy - add FSD and/or Acceleration Boost after buying, keeping the official price down.