"Ford Options" Mach-E Lease vs standard lease - similarities and differences

[macchiaz-o]

So what happens if I am due a return?

So what happens if the fed owes you at the end of the year ?

That only means that you've overpaid. That doesn't mean you can't take a tax credit.

You owe a certain amount of tax for the whole year. You make federal tax payments throughout the year (for example, withheld from your paychecks). Then at the beginning of the next year, you reconcile this by "filing taxes" and you find out that you overpaid... So you tell the feds to pay the excess back to you.

So let's say that the U.S. government determines that you should pay them $20,000 in taxes for 2021. And let's keep this simple -- no Mach-E was purchased that year.

Now here we are at the beginning of 2022. You're "doing your taxes" and you find out from looking at your W-2 and everything else that you've already paid the government $21,000 throughout 2021... But you only owed them $20,000. In other words, you've overpaid and have now determined that you're due a refund of $1,000.

Now let's add in the Mach-E to the equation. In 2021, you purchased a brand new Mustang Mach-E. The special tax credit for that purchase is worth up to $7,500 towards your 2021 total tax amount. This means instead of owing $20,000 for 2021, you actually just owe $12,500.

But you already paid $21,000 in taxes. Oops! No problem, now your refund will be $8,500.

The only thing the credit doesn't allow you to do is go negative on "total tax." If the feds say your total tax for the year is $4,000 before considering the credit, then the credit can only be worth $4,000 instead of the full $7,500. It's a "non-refundable" credit.

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[YFD_233]

That only means that you've overpaid. That doesn't mean you can't take a tax credit.

You owe a certain amount of tax for the whole year. You make federal tax payments throughout the year (for example, withheld from your paychecks). Then at the beginning of the next year, you reconcile this by "filing taxes" and you find out that you overpaid... So you tell the feds to pay the excess back to you.

So let's say that the U.S. government determines that you should pay them $20,000 in taxes for 2021. And let's keep this simple -- no Mach-E was purchased that year.

Now here we are at the beginning of 2022. You're "doing your taxes" and you find out from looking at your W-2 and everything else that you've already paid the government $21,000 throughout 2021... But you only owed them $20,000. In other words, you've overpaid and have now determined that you're due a refund of $1,000.

Now let's add in the Mach-E to the equation. In 2021, you purchased a brand new Mustang Mach-E. The special tax credit for that purchase is worth up to $7,500 towards your 2021 total tax amount. This means instead of owing $20,000 for 2021, you actually just owe $12,500.

But you already paid $21,000 in taxes. Oops! No problem, now your refund will be $8,500.

The only thing the credit doesn't allow you to do is go negative on "total tax." If the feds say your total tax for the year is $4,000 before considering the credit, then the credit can only be worth $4,000 instead of the full $7,500. It's a "non-refundable" credit.

gotcha. Last year I owed like $6000 in federal so I guess I can say that with the $7500 I would get $1500 instead of paying 6k. Thanks.

 

[macchiaz-o]

gotcha. Last year I owed like $6000 in federal so I guess I can say that with the $7500 I would get $1500 instead of paying 6k. Thanks.

Yeah, this is correct as long as your total tax was at least $7,500 before factoring in this EV credit.

 

[Maquis]

gotcha. Last year I owed like $6000 in federal so I guess I can say that with the $7500 I would get $1500 instead of paying 6k. Thanks.

No - get out last year’s tax return. Look at line 24. You will pay less taxes by that number or $7500, which ever is less.

 

[YFD_233]

 

[macchiaz-o]

This is all correct, but confusing. It's critical that you understand the meaning of tax liability. Liability doesn't mean amount refunded or owed in April.

Check line 24 "total tax" on your returns.

 

[Triggerhappy007]

Is there another way to look for the Options rate and rebate for my state? I used the order website and selected the calculator and checked Ford Options but it's showing an APR of 5% and doesn't list any rebate at all. I'm in TX btw.

Nevermind, you have to select the dealer first, then it'll show you the correct APR and rebate.

 

[YFD_233]

No - get out last year’s tax return. Look at line 24. You will pay less taxes by that number or $7500, which ever is less.

My total tax (line 24) last year was $26,787. I owed $8,443. So can I assume if this was the year of the Mach e I would of just owed $943??

 

[macchiaz-o]

So if I owed $1000 then I would get refund of $6500?

If I was due a return of $5000 I would get $12500?

Am I doing this right?

Yes, because your total tax is greater than $7,500 before accounting for the vehicle purchase.

 

[yngwenli]

I'm way behind on reading here, but I just started this thread to hopefully, once and for all, Ford will update the EPA classification in reference to the CA CVRP:

https://www.macheforum.com/site/thr...te-mach-e-to-be-an-suv-on-u-s-epa-data.14204/

From reading the Tesla forums, I think ANY Select models will qualify, but all others will not after Feb 24th since the line item will show a higher "base".

GT will not qualify even if reclassified due to $61,995 base MSRP.

 

[Rudy Bega]

Has any MME GTPE owner successfully claimed the $7,500 credit, and what would prevent a credit for a 2021 taken in the 2022 tax year?

 

[Rudy Bega]

Has any MME GTPE owner successfully claimed the $7,500 credit, and what would prevent a credit for a 2021 taken in the 2022 tax year?

Should have mentioned that I will take the 21 in February 22, this month?

 

[macchiaz-o]

Should have mentioned that I will take the 21 in February 22, this month?

As long as you purchase the vehicle as it's first owner (not lease) and your 2022 tax liability ("total tax" on your 1040) is greater than $7,500, you'll get that full amount credited to your liability.

I massively reduced my W-4 withholdings during 2021 and now that I'm filing my 2021 taxes, I can see the $7,500 impact to the taxes I still owe.

 

[Rudy Bega]

As long as you purchase the vehicle as it's first owner (not lease) and your 2022 tax liability ("total tax" on your 1040) is greater than $7,500, you'll get that full amount credited to your liability.

I massively reduced my W-4 withholdings during 2021 and now that I'm filing my 2021 taxes, I can see the $7,500 impact to the taxes I still owe.

Many thanks!

 

[Dancefreak]

Why is this thread now about tax rebates and not options? I do see I contributed to the problem earlier haha.

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