US Federal $7,500 Electric Vehicle Credit Expiry Date By Automaker

[kengchang]

Not sure if this has been mentioned yet, and it's certainly not definitive, but during the process of ordering a RWD or Dual Motor version, the site shows a 3 - 5 month delivery and includes the $7500 tax credit in the "price after incentives and gas saving" in the lower banner and on the Summery/Payment page.

That doesn't prove anything.

Incentive programs are offered and administered by government agencies. Eligibility and availability vary and are outside of Tesla’s control. Most programs are limited to a total dollar amount that can be dispersed or will expire on a certain date. Be sure to visit the state program’s website for the most up-to-date information on availability and redemption requirements.

Your eligibility for income tax credits depends on your personal tax situation. We recommend speaking with a tax professional for guidance.

 

[Sonny Daze]

That doesn't prove anything.

It proves that Tesla want's to give everyone the impression that cars delivered in Q4 will be eligible for the full credit. Hopefully they wouldn't do this if they know for a fact that this is not true. Fingers crossed.

 

[bhzmark]

The number acquired is not what Tesla reports to the IRS. Manufacturers report vehicles sold to consumers or retail dealerships.

Buyer's acquire and Seller's sell. The different sides of the same concept use slightly different words. I suppose the tax rule could be read that the acquisition by buyer is the date of title transfer under state law -- while the sale date of the seller is a different date. They could have said that but they didn't. But I agree that would be a conceptually possible but administratively annoyingly complex and annoyingly allowing for mismatches between the sales by sellers and acquisitions by buyers.

More likely the same concept is used for both -- namely when title transfers under state law which is a brighter line and easier event to mark and be certain of.

Tesla didn't sign over the title, yet accepted payment from the bank, isn't that sort of fraud?

Tesla doesn't "sign over the title".

Only in the movie Grease, when they race for "pinkslips" do they "sign over the title." Tesla mails or otherwise delivers the title transfer paperwork to the relevant state(s). And they promise in their contract that they will do so.

When you buy a house the seller may promise that they will record a deed transfer, or release a lien on some future date. It isn't fraud when it doesn't happen simultaneous with closing -- they are still obligated to do it.

the vehicle/ title is deemed to be the purchaser's from the time of purchase

No. The title of the vehicle is deemed to be transferred from one owner to the other when state law says it is transferred. Per the sale contract, the buyer and sellers will still have liability to each other for screwing up the sale in some way, but the title transfer event is a bright line easy to mark event as dictated by state law.

 

[bhzmark]

Only for purchases in Cali. A purchase in another state is bound by that state's laws. Unless the person picks up the car in Cali, there is no Cali title, only a title of the state they live/ bought it in. Consider also the fee schedule for a purchase in Cali has no bearing on a purchase in Ohio. And I, as a Michigan resident, can't use the ability to purchase a Tesla in Cali to purchase a Tesla in MI...

If the car is titled in California, the transfer of the title is governed by California and also the state that the title is being transferred to.

"(a) No transfer of the title or any interest in or to a vehicle registered under this code shall pass, and any attempted transfer shall not be effective, until the parties thereto have fulfilled either of the following requirements . . " California Code, Vehicle Code - VEH § 5600 | FindLaw


The buyer will have the consumer protections of his state and other rights under that state, but that is a different concept.

Maybe there is some rule that OEMs don't have to own their cars before sale in a different way -- , but I couldn't find that they had any exclusion from the above rule.

 

[mongo]

Buyer's acquire and Seller's sell. The different sides of the same concept use slightly different words. I suppose the tax rule could be read that the acquisition by buyer is the date of title transfer under state law -- while the sale date of the seller is a different date. They could have said that but they didn't.

Right, they say when the manufacture sells the vehicle, including selling it to a retail dealer. There is no consumer acquisition associate with the dealer sale. Therefore, at least in that case, they are two distinct times/ actions.

But I agree that would be a conceptually possible but administratively annoyingly complex and annoyingly allowing for mismatches between the sales by sellers and acquisitions by buyers.

And having a date of title transfer recorded vs date you bought the car isn't annoyingly complex? How does one report that to the IRS? What will happen during the phase out dates, are people going to hound the clerks?

More likely the same concept is used for both -- namely when title transfers under state law which is a brighter line and easier event to mark and be certain of.

Not if the date is some floating moment when a clerk processes the paperwork. And not based on the written law/ guidance.

No. The title of the vehicle is deemed to be transferred from one owner to the other when state law says it is transferred. Per the sale contract, the buyer and sellers will still have liability to each other for screwing up the sale in some way, but the title transfer event is a bright line easy to mark event as dictated by state law.

Again, it is an easy to mark event if a successful transfer is deemed to have happened at the time of sale (the Michigan method, and California option (1) quoted previously). Otherwise, how does a consumer determine when the transfer 'really' occurred?

 

[mongo]

If the car is titled in California, the transfer of the title is governed by California and also the state that the title is being transferred to.

"(a) No transfer of the title or any interest in or to a vehicle registered under this code shall pass, and any attempted transfer shall not be effective, until the parties thereto have fulfilled either of the following requirements . . " California Code, Vehicle Code - VEH § 5600 | FindLaw


The buyer will have the consumer protections of his state and other rights under that state, but that is a different concept.

Are you are saying that when a new Tesla is purchased in Ohio, the title transfer fee is paid to California?
I think the "registered under this code" clause means registering the car in CA. Even if it means cars currently registered in CA, that would not apply to a new vehicle. I've never hear of paying a fee to export a car from a one state to another (which means nothing)

 

[thx1139]

Maybe we would understand better this whole discussion of what wouldnt count or when something counts if we had examples.

Since Tesla doesnt sell to dealers. I would think the sale counts on the day the delivery is made.

Now I think I have heard that if the person buying it is immediately shipping overseas it may not count. Would that be if the person isnt someone who lives in the US so a tax credit means nothing.

I also think I have heard if the car is being bought by a government agency it wouldnt count in the count. Is that correct?

Are people saying that if I take delivery and it takes a couple of days for a state to transfer the title it wont count? Say deliver on June 29th and state registers this on July 2nd.

Are people saying that if I take delivery and purchase with a loan that the date isnt until I get the title when the loan is paid off?

 

[bhzmark]

Therefore, at least in that case, they are two distinct times/ actions.

Yes, GM must count Bolts sold to Jim Bob's Auto Emporium, but Tesla doesn't do such nonsense. So every Tesla sale has a consumer acquisition.

How does one report that to the IRS?

The California rule is pretty clear: "The transferor has delivered to the department or has placed in the United States mail addressed to the department the appropriate documents for the registration or transfer of registration of the vehicle pursuant to the sale or transfer "

Tesla can control exactly what date that they put it in the mail or otherwise deliver it. Nothing could be easier. And this a common filing date evidence method. An employee can swear an affidavit/certification that "I delivered these 500 title transfer paperwork on this date, or dropped it in the mail on this date." That is a commonly used method well-proven to mark a date of delivery or service etc.

 

[ccutrer]

Are people saying that if I take delivery and purchase with a loan that the date isnt until I get the title when the loan is paid off?

If there's a loan, the title gets sent to the lien-holder. Just cause you don't have it, doesn't mean there isn't one. When you pay off the loan, they send you the title, signed for approval to remove the lien. You then take it to the DMV and get a corrected title without the bank on it.

 

[thx1139]

If there's a loan, the title gets sent to the lien-holder. Just cause you don't have it, doesn't mean there isn't one. When you pay off the loan, they send you the title, signed for approval to remove the lien. You then take it to the DMV and get a corrected title without the bank on it.

I understand that. Maybe I wasnt clear. Is this a case where someone is interpreting the rule that the car should be added to the count. When is a car not added to the count on the day it is delivered. Instead of back and forth on the legalese lets carve out when a car wouldnt be added.

I for one dont think they hit the 200K in June because configuration for Model 3 is still using full credit for cars that arent expected to be delivered until after September.

 

[Sonny Daze]

Not sure if this has been mentioned yet, and it's certainly not definitive, but during the process of ordering a RWD or Dual Motor version, the site shows a 3 - 5 month delivery and includes the $7500 tax credit in the "price after incentives and gas saving" in the lower banner and on the Summery/Payment page.

I see that @Shmackers mentioned this yesterday, sorry.

As far as all the talk about what a sale is and when it is final, I don't think Tesla or the IRS are going to investigate down to the state level to determine this. I think Tesla will report the number of sales they have completed from their point of view and the IRS will accept that, unless there is some sign of obvious fraud.

 

[mongo]

Yes, GM must count Bolts sold to Jim Bob's Auto Emporium, but Tesla doesn't do such nonsense. So every Tesla sale has a consumer acquisition.

You are creating two different criteria. In the OEM case, the OEM sale and the buyer acquisition are clearly separate events. Where, from the law, do you get that a sale to a consumer joins these two actions into one inseparable event?

The California rule is pretty clear: "The transferor has delivered to the department or has placed in the United States mail addressed to the department the appropriate documents for the registration or transfer of registration of the vehicle pursuant to the sale or transfer "

Tesla can control exactly what date that they put it in the mail or otherwise deliver it. Nothing could be easier. And this a common filing date evidence method. An employee can swear an affidavit/certification that "I delivered these 500 title transfer paperwork on this date, or dropped it in the mail on this date." That is a commonly used method well-proven to mark a date of delivery or service etc.

I was referring to the consumer filling their EV tax credit. How do they know when Tesla mailed it? Not an issue for the trigger, but critical for the phase out...

In that law, is (2) related to registration vs (1) which is ownership/ registration?

 

[Dr. J]

Not a lawyer, but full faith and credit clause of US constitution: states within the United States have to respect the "public acts, records, and judicial proceedings of every other state." One of the reasons that your driver license from California will work in Texas regardless of potential difference in DMV rules etc. And this seems like one of the issues that may fall into the clause, as motor vehicle authorities are pretty much under state authority.

If you MOVE TO or DRIVE in another state. Not that California law APPLIES in Texas. It's why it's called "state law."

 

[Dr. J]

I meant Tesla can rely on California law because the car is built in California and it is property owned in California and governed by California law and title of California property only passes when California law says it does.

Tesla may be able to rely on that even when another state says something else.

Texas law governs when title passes in Texas, even if the car is purchased out of state.

 

[MP3Mike]

Tesla doesn't "sign over the title".

Of course they don't. There is no title for them to sign over until the vehicle has been purchased and put into service the first time. (And Tesla is not the holder of titles on new cars, only on cars they purchase from other people.)

Tesla creates a "Certificate of Origin" that is taken to the DMV and turned in to get an initial title issued. That normally happens in the state that the purchaser resides in. California has nothing to do with it in most cases.

 

[mongo]

Of course they don't. There is no title for them to sign over until the vehicle has been purchased and put into service the first time. (And Tesla is not the holder of titles on new cars, only on cars they purchase from other people.)

Tesla creates a "Certificate of Origin" that is taken to the DMV and turned in to get an initial title issued. That normally happens in the state that the purchaser resides in. California has nothing to do with it in most cases.

Thanks. Yeah, I was using a term to indicate Tesla delaying the legal transfer of a vehicle while accepting the money for the vehicle (which was supposed to be collateral in the case of loan). Not meaning a real pink slip in the days of electronic titles...

 

[MP3Mike]

Not meaning a real pink slip in the days of electronic titles...

Have some states switched to electronic titles? Here in Oregon they are still very much paper, and a pain to get replaced if lost. (Though they aren't pink.)

 

[Super_Popular]

Have some states switched to electronic titles? Here in Oregon they are still very much paper, and a pain to get replaced if lost. (Though they aren't pink.)

Most states are electronic, like you said Oregon is not.

 

[mongo]

Have some states switched to electronic titles? Here in Oregon they are still very much paper, and a pain to get replaced if lost. (Though they aren't pink.)

I think the manufacturer doesn't need/ have a title on a new car....

 

[bhzmark]

I was referring to the consumer filling their EV tax credit. How do they know when Tesla mailed it? Not an issue for the trigger, but critical for the phase out...

Consumers don't need to know the delivery date and calculate the phase out. Tesla will follow the rules for them to provide certification to consumers to rely on, including the amount of the credit to which they are entitled.

.02 Purchaser’s Reliance. Except as provided in section 5.07 of this notice, a purchaser of a motor vehicle may rely on the manufacturer’s (or, in the case of a foreign vehicle manufacturer, its domestic distributor’s) certification concerning the vehicle and the amount of the credit allowable with respect to the vehicle (including in cases in which the certification is received after the purchase of the vehicle). The purchaser may claim a credit in the certified amount with respect to the vehicle if the following requirements are satisfied:

(1) The vehicle is placed in service by the taxpayer in a taxable year beginning after December 31, 2009, and is acquired by the taxpayer after December 31, 2009;

(2) The original use of the vehicle commences with the taxpayer;

(3) The vehicle is acquired for use or lease by the taxpayer, and not for resale; and

(4) The vehicle is used predominantly in the United States.​

03 Content of Certification. The certification must contain the following:​

(1) The name, address, and taxpayer identification number of the certifying entity.

(2) The make, model, model year, and any other appropriate identifiers of the motor vehicle.

(3) A statement that the vehicle is made by a manufacturer.

(4) A statement that the vehicle is treated as a motor vehicle for purposes of Title II of the Clean Air Act.

(5) The amount of the credit for the vehicle (showing computations).