2023 Add ons

Ngkgb

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So I picked up a 2022 Premium at a very reasonable ADM(at least for Cali) and also have a reservation for a 2023 that went into production 11/2. Since my wife doesn’t want the red 2023, I asked dealer if they’ll sell it to my friend for MSRP. Hard no. 5k ADM minimum. Wtf. 5k ADM on top of an already 6k higher MSRP vehicle. Are people gonna pay 62k for a premium Mach E?! Maybe I’ll take it and sell it and pocket the EV credit. Crazy times.
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RickMachE

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Buying and reselling means no EV tax credit.
 

RickMachE

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This is tracked? What if you order a car and don’t like it since you never test drive it?
https://www.irs.gov/instructions/i8936

The following requirements must be met to qualify for the credit.

You are the owner of the vehicle. If the vehicle is leased, only the lessor and not the lessee, is entitled to the credit.
You placed the vehicle in service during your tax year.
The vehicle is manufactured primarily for use on public streets, roads, and highways.
The original use of the vehicle began with you.
You acquired the vehicle for use or to lease to others, and not for resale.
You use the vehicle primarily in the United States.
 
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Ngkgb

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Is this the honor system? How do they track this?
 


MachKet

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Is this the honor system? How do they track this?
Essentially, hypothetically you can just say you don’t like the car and sell it with no repercussions
 

yngwenli

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So I picked up a 2022 Premium at a very reasonable ADM(at least for Cali) and also have a reservation for a 2023 that went into production 11/2. Since my wife doesn’t want the red 2023, I asked dealer if they’ll sell it to my friend for MSRP. Hard no. 5k ADM minimum. Wtf. 5k ADM on top of an already 6k higher MSRP vehicle. Are people gonna pay 62k for a premium Mach E?! Maybe I’ll take it and sell it and pocket the EV credit. Crazy times.

As long as people pay ADM, dealers can and will charge as much as possible. Similar to companies paying as low as they can to keep/attract people, this is all part of running a business.

I don't think anyone should get upset that there is ADM on a car now. Just tell your friend to order a new 2023 him/herself. Saves the time/hassle/argument of getting in a dealer spat/fight or wondering if they will even hold their end of the bargain. Worst case is your dealer says yes now, 6 months from now, your friend shows up and the dealer sold the car to someone else with a $10k ADM telling you to pound sand.

We'll see what happens when 2023s actually show up, if they have a full tax credit due to delaying battery components talk/etc, folks who qualify may still jump since prices across almost all EVs have gone up minus the Bolt.

I see a local dealer cut ADM by $5k, but inventory seems to be dropping after that (after it was $15k) so they are moving or maybe folks negotiated slightly down. Gas is still $6 in CA. EV for solar owned people makes way too much sense in CA and I'm still anyone would even buy an ICE car for basic transportation (outside of towing/very frequent long trips/etc). I can't see myself ever buying a gas car again.
 

Kamuelaflyer

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This is tracked? What if you order a car and don’t like it since you never test drive it?
VINs are required for the tax credit. If someone knowingly takes a tax credit they are not entitled to, they have committed tax fraud. The IRS tends to have a dim view of that.

As for not selling to your friend at MSRP, that’s entirely within the dealer’s rights. The car belongs to the dealer once it rolls out the doors at the factory. If you’re not buying it, they don’t have to sell or offer it to your designee.
 

Vulnox

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Plus buying it and selling it for the tax credit even if you get away with it or whatever probably won't be as sure a thing as it once was. There are a bunch of threads on here of people that were going to sell their MME but were waiting on another car or a repair or whatever, and watched the value offered drop by $6-9k in a matter of a few months. The used car market values are dropping fast, and after you pay taxes and that on top of MSRP, you better hope someone buys it for over MSRP knowing they won't get the tax credit if you hope to get much for it.

Seems more trouble and risk than it's worth.
 

MisterSofa

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Buying and reselling means no EV tax credit.
The IRS needs to change the system. Perhaps one EV tax credit every two years per person or family. Until that is changed, many people will take advantage of this.
 

generaltso

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The IRS needs to change the system. Perhaps one EV tax credit every two years per person or family. Until that is changed, many people will take advantage of this.
They‘ve already changed it for next year. One new EV tax credit per taxpayer per year.
 

nvabill

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Is this the honor system? How do they track this?
Yes, it is the honor system. That and the vin has to be provided to take the credit so the car needs to be registered/titled in the taxpayer's name.
 

gryphon

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Yes, it is the honor system. That and the vin has to be provided to take the credit so the car needs to be registered/titled in the taxpayer's name.
Truly no more an honor system than many aspects of the Federal tax code. If one gets selected for audit having claimed an EV credit, one better hope that the VIN was registered to them at the time of initial purchase. Or, in the parlance of the code, when the vehicle was "put into service."
 

RickMachE

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Is this the honor system? How do they track this?
VINs are required for the tax credit. If someone knowingly takes a tax credit they are not entitled to, they have committed tax fraud. The IRS tends to have a dim view of that.

As for not selling to your friend at MSRP, that’s entirely within the dealer’s rights. The car belongs to the dealer once it rolls out the doors at the factory. If you’re not buying it, they don’t have to sell or offer it to your designee.
Truly no more an honor system than many aspects of the Federal tax code. If one gets selected for audit having claimed an EV credit, one better hope that the VIN was registered to them at the time of initial purchase. Or, in the parlance of the code, when the vehicle was "put into service."
I had to laugh at the "honor system" comments. An honor system relies on the honest of those concerned for payment. The tax code has the hammer of prosecuting a person for tax fraud, which is a felony, carries financial penalties, and possible jail time. Much difference than the honor system.

In addition to following the tax code for a tax credit on an EV, if you buy, and sell for a profit, then you also need to declare a capital gain, either short (less than 12 months) or long (12 months or longer), on your federal AND state returns. In my case, we sold at 375 days after purchase, so it's a long term gain. I've documented all my costs, which raise the cost basis of the vehicle, and stuck them in a file for when I do my taxes, so that my gain is as small as possible.
 
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Ngkgb

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What if I sell the Premium we’ve had for a month to buy the 2023?
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