$7,500 Fed Tax Credit CHANGES in 2023 BIG TIME

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Triggerhappy007 said:
That's going to be crazy to keep track of unless the government makes some kind of database of VIN numbers.

cwerdna said:
Gotta love the misreporting by CNBC I heard last night.
Interesting reading that. Many articles appearing now attempting to clarify.

Bottom line, the IRS will have to set up a website where you can run a VIN, and maybe a make+model+year, with production date maybe?, to check if a vehicle qualifies. They might even share the current NHTSA website database where they now take a VIN and tell you recalls, now adding the EV credit thumbs up/down and $ amount you get in a tax credit.

If you google the words:
cars eligible for the $7,500 ev tax credit
A bunch of articles pop up. Too much to read, we'll wait for IRS guides.

At first I thought the Mustang Mach E won't qualify, assembled in Mexico, but the the assembly requirement is not the U.S. alone, it's "North America", Canada, U.S., Mexico....

Edit: now I see the Feds moving toward a database system: https://home.treasury.gov/news/press-releases/jy0923
 
EV tax credit consequence: Plug-in vehicle lease prices are soaring
https://www.greencarreports.com/news/1136891_ev-tax-credit-plug-in-vehicle-lease-prices-are-soaring
 
I'm feeling especially dense today :| Could someone explain to me why lease prices jumped up due to this? Toyota has exceeded 200k EV's so the existing rebate was set to be phased out for them anyway. Ditto for Tesla I guess. I'm sure it's simple but I can't understand why this makes such a difference. Are they thinking the demand will go up?
 
goldbrick said:
I'm feeling especially dense today :| Could someone explain to me why lease prices jumped up due to this? Toyota has exceeded 200k EV's so the existing rebate was set to be phased out for them anyway. Ditto for Tesla I guess. I'm sure it's simple but I can't understand why this makes such a difference. Are they thinking the demand will go up?
Toyota phaseout (where it gets cut to 1/2, 1/4 then 0) wasn't going to start until 10/1/2022 w/it first being half: https://web.archive.org/web/20220726050624/https://www.fueleconomy.gov/feg/taxevb.shtml but given some of the below, if you didn't already have a binding contract to purchase before Biden signed or took delivery before then, you are subjected to new rules, so suddenly all Toyota became ineligible because none of their EVs/PHEVs are assembled in North America.

https://electrek.co/2022/08/07/senate-improves-ev-tax-credit-in-largest-climate-bill-ever/ (search it for signs)
https://electrek.co/2022/08/13/if-you-want-an-ev-buy-this-week-rivian-fisker-ev-tax-credits/ - search for Toyota
https://www.greencarreports.com/news/1136859_irs-2022-ev-phev-tax-credit-american-made

Tax credit has been 0 on Teslas for awhile now and AFAIK, they weren't passing it along in the form of a cheaper lease even when their tax credit was above 0.

In the past, if you leased, the automaker/its leasing company received the tax credit. They could choose to pass along 0 to the entire tax credit to the lessee in the form of a cheaper lease. When I leased my 1st Leaf, NMAC passed along all $7500 + a bit more. So, it looked likea a $7500 down payment was made on my behalf.

For the '22 Niro EV I'm leasing, Kia Financial also passed that along + a bunch more. It looked like about $11K was already paid for me the day I picked up my car.

HyunKia have also hit 0 because their BEVs and PHEVs aren't assembled in the US. Imagine if my total cost of lease went up by $7500?

This has affected a ton of other makes and models.

https://www.fueleconomy.gov/feg/taxevb.shtml says:
If you purchase and take possession of a qualifying electric vehicle after August 16, 2022 and before January 1, 2023, final assembly of the vehicle had to be completed in North America, otherwise the same rules in effect prior to the enactment of the Inflation Reduction Act apply (including those involving the manufacturing caps on vehicles sold).

The Department of Energy has provided a list of Model Year 2022 and early Model Year 2023 electric vehicles that may meet the final assembly requirement. Because some models are built in multiple locations, there may be vehicles on the list that do not meet the final assembly requirement in all circumstances.
The list is at https://afdc.energy.gov/laws/inflation-reduction-act. Notice TONS of PHEVs and EVs are missing from it? https://www.greencarreports.com/news/1136839_tax-credit-unlikely-to-return-for-these-evs-and-plug-in-hybrids may help.

Basically, if you didn't already have a binding purchase agreement or take delivery prior to Aug 16 (which, the IRS decided to put up on Aug 16, the day Biden signed: https://www.irs.gov/credits-deductions/individuals/plug-in-electric-drive-vehicle-credit-section-30d), the new rules apply (e.g. where assembled, income cap, etc.)

I haven't kept up with most of this either since I'm not in the market, it's been messy and I'm disqualified from the purchase side anyway due to income caps. Not sure how leases (for those above income cap) are handled for vehicles that otherwise qualify.
 
I hear Japan & S. Korea are ticked about this law giving rebates to Mexico & Canada instead of their EVs! Other EU countries as well not happy. I kind of agree. Why does Mex and Can get favored status, leaving out those loyal allies with stable democratic governments?

Interesting, complicated new law. I'm just glad the "Inflation Reduction Act" will wipe out inflation forthwith pronto ! We're saved, and they named it accordingly. :shock: :mrgreen:

"The government has until the end of the year to develop guidance on the battery requirements."
All the battery parts & mineral sourcing stuff will add some complexity.

It all really just comes down to entering a VIN or make+model+year+battery_utilized into a government overLord website & getting blessed or not.
 
Thanks cwerdna. I guess this is the part I missed:

cwerdna said:
In the past, if you leased, the automaker/its leasing company received the tax credit.

I scanned the linked article and saw Tesla mentioned and that threw me off. I just re-read it a bit more carefully and Tesla was mainly discussed in comparison to the other brands. At first I thought that Tesla lease prices were also jumping up (and they might...) and that made no sense but I don't think the article said anything about that. It was just a mis-reading on my part.
 
Hope this isn't a repost.

IRS posted this FAQ on 12/9/22: https://www.irs.gov/newsroom/frequently-asked-questions-about-the-new-previously-owned-and-qualified-commercial-clean-vehicles-credit.

I haven't read most of it due to lack of time and since I won't qualify anyway.
 
(Probably reported already elsewhere, but I'm too lazy to do a long search)
The Nissan Leaf lost the $7,500 tax credit recently. It's the mineral & battery materials problem.
https://fueleconomy.gov/feg/tax2023.shtml

This has been up and down, drives people a little crazy, for those that are in the market.
 
voltamps said:
(Probably reported already elsewhere, but I'm too lazy to do a long search)
The Nissan Leaf lost the $7,500 tax credit recently. It's the mineral & battery materials problem.
https://fueleconomy.gov/feg/tax2023.shtml

This has been up and down, drives people a little crazy, for those that are in the market.

Yes it was ;) , but to update that, Japan has a "strategic trade agreement on battery materials" with the US now, so I posted about this a few months back that the rumors at Nissan HQ is that they might be able to restore this by 2024 for Leaf and Ariya. Nothing set in stone yet and some political behind the scenes work is probably also in progress... :?
 
knightmb said:
Yes it was ;) , but to update that, Japan has a "strategic trade agreement on battery materials" with the US now, so I posted about this a few months back that the rumors at Nissan HQ is that they might be able to restore this by 2024 for Leaf and Ariya. Nothing set in stone yet and some political behind the scenes work is probably also in progress... :?
Interesting geo-political-trade dynamics at work here. Anybody wanting a cheaper new Leaf right now is fuming!
I actually get into international stuff like that. Check out Peter Ziehan on youtube https://www.youtube.com/@ZeihanonGeopolitics/videos for all kinds of planet-wide issues.

I've noticed that "put into service after April 18, 2023" is when the rules got tight.
Very few 2024 models are currently listed!
CwT2T9a.png
 
It looks like the 2024 Leaf purchases this year will qualify for the partial $3750 tax credit since they're certified to meet the “battery component” requirements...
https://usa.nissannews.com/en-US/releases/2024-nissan-leaf-eligible-for-3750-ev-tax-credit
 
henrydehoja said:
It looks like the 2024 Leaf purchases this year will qualify for the partial $3750 tax credit since they're certified to meet the “battery component” requirements...
https://usa.nissannews.com/en-US/releases/2024-nissan-leaf-eligible-for-3750-ev-tax-credit
That article says it only goes until the end of calendar year 2023.
Wonder why they cut it off then? 2024 models will be sold of course in 2024 too.
 
voltamps said:
That article says it only goes until the end of calendar year 2023.
Wonder why they cut it off then? 2024 models will be sold of course in 2024 too.

Based on what I've read in the IRS site webpages, IRS fact sheets and the following US government site, it seems to me that the government has definite plans up to Dec. 31, 2023; they may still be working on final plans for 2024.
https://fueleconomy.gov/feg/tax2023.shtml

I was checking around and see that the site above still doesn't list the 2024 Leaf as being eligible, despite the recent articles. Looks like the government sites need some updates.
 
henrydehoja said:
https://fueleconomy.gov/feg/tax2023.shtml

I was checking around and see that the site above still doesn't list the 2024 Leaf as being eligible, despite the recent articles. Looks like the government sites need some updates.
They got it now. I just tried the website you listed, and, you are correct, $3750 tax credit is available for a 2024 Leaf S or SV+, if purchased before the end of calendar year 2023.
Well, not $7500, but something anyway. (Aria is completely left out. :roll: )
 
voltamps said:
henrydehoja said:
It looks like the 2024 Leaf purchases this year will qualify for the partial $3750 tax credit since they're certified to meet the “battery component” requirements...
https://usa.nissannews.com/en-US/releases/2024-nissan-leaf-eligible-for-3750-ev-tax-credit
That article says it only goes until the end of calendar year 2023.
Wonder why they cut it off then? 2024 models will be sold of course in 2024 too.
Because it looks like the battery component and critical mineral requirements appear to go up by year. They're higher for 2024 than 2023.
https://home.treasury.gov/news/press-releases/jy1379
https://afdc.energy.gov/laws/409

So, those Leafs may be eligible for less tax credit in calendar year 2024.

On this note, there was https://cleantechnica.com/2023/07/14/tesla-tells-us-customers-tax-credit-likely-to-decline-in-2024/.
 
cwerdna said:
Because it looks like the battery component and critical mineral requirements appear to go up by year.
OK, good sleuthing there. The complex picture is beginning to emerge.
I was actually thinking about upgrading to a new Ioniq 5 AWD, yet no tax benefit, and I'm too cheap to do it now. That is one nice EV! Want one!

This article written recently seems to have a lot of details:
https://www.consumerreports.org/cars/hybrids-evs/electric-cars-plug-in-hybrids-that-qualify-for-tax-credits-a7820795671/

This is quite a game the Feds are playing here.
 
Ariya gets no tax credit because it isn't assembled in North America. All assembled outside North America BEVs got screwed from a tax credit POV around Aug 17, 2022. See https://www.fueleconomy.gov/feg/tax2022.shtml. (My memory is getting foggy on the details right now.)
 
I think I've found the "best" bargain, maybe, amongst all these new, strange tax credit rules.

USED Leafs
actually get a Federal tax credit, of $4,000, or not to exceed 30% of the used car purchase price.
You have to buy a 2021 or older Leaf, first of all.

I think ALL 2021 or older used Leafs qualify, but do check the federal websites listed below to be sure.
You have to read at least these two web pages to make sure you can get the $4,000 tax credit, because of all the requirements:
https://www.fueleconomy.gov/feg/taxused.shtml#requirements
https://www.irs.gov/credits-deductions/used-clean-vehicle-credit

I'm seeing some pretty new-ish looking '21 Leaf SV+ models with not many miles on them for around $20k plus or minus.
A $4,000 tax credit takes a nice chunk out of it!
I might try this.
 
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