How will we know if our purchase is eligible for the full tax credit?

macgyver60

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I read a few months back that not all of the first run of the Mach E will be eligible for the full $7500 tax credit. I was hoping this wouldn't matter since I reserved the premium and expected to get it late 2020 or very early 2021. Now it seems my local dealer is completely out of the loop on this car. I am trying to find out if they will allow a refund on the $500 deposit in case I don't like the car once I actually sit in it. The comfort of the seat is a huge thing for me. They keep telling me come back in another week or two because they have no info on the car. Losing the $500 deposit would be bad enough but if I can't get the full tax credit I may reconsider the whole purchase. Is there any way to know at the time we purchase if we will be eligible for the tax credit?
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timbop

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I read a few months back that not all of the first run of the Mach E will be eligible for the full $7500 tax credit.
That is very much incorrect. The reduction kicks in at the end of the calendar quarter AFTER the quarter in which Ford has sold their 200,000th EV in the United States. Last I checked they were at roughly 125,000 EV's sold in the US since they began selling hybrids in 2012 or so. Ford is only selling 50k Mach E's in the first year, but a significant portion will be sold in europe. This has come up many times, I suggest you do a search in this forum to see lots of discussion about it. I don't have the link handy, but the EPA (feuleconomy.gov irs.gov) has a page that lists what carmakers are over the the 200k mark, and how close others including ford are. Again, I got that link here so the search button helps - or your friend google

**** EDIT***
Here's the link; it is to irs.gov not feuleconomy.gov: https://www.irs.gov/businesses/irc-30d-plug-in-electric-drive-motor-vehicle-credit-quarterly-sales
 
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macgyver60

macgyver60

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Thanks for the info. No problem having a $7500 tax liability unfortunately so that shouldn't be an issue
 

Paulalex01

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Also, monitor your tax payments. If your tax liability is $7500 and you've paid $7500 in withholding; guess what, the government is going to give back your $7500 and the tax incentive is $0.00.
 

eager2own

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If your tax liability is $7500 and you've paid $7500 in withholding; guess what, the government is going to give back your $7500 and the tax incentive is $0.00.
I'm not sure what you mean by a tax incentive of $0.00. If you're getting back $7,500 that was withheld because you bought the EV (so this is money you wouldn't have received back absent the tax credit)... that's a tax incentive of $7,500 -- not $0.
Whether or not you had withholdings of $7,500 only changes the timing of when you have that money in hand. It's the tax liability that really impacts whether or not the tax incentive has any value to you.
 


timbop

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Also, monitor your tax payments. If your tax liability is $7500 and you've paid $7500 in withholding; guess what, the government is going to give back your $7500 and the tax incentive is $0.00.
If your tax liability is $7500 and you had $7500 withheld, the BEV credit will wipe out your $7500 liability and you will get a refund of the $7500 withheld from your paychecks. So you get $7500 in cash back from the IRS. How is the incentive $0?
 

Paulalex01

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I'm not sure what you mean by a tax incentive of $0.00. If you're getting back $7,500 that was withheld because you bought the EV (so this is money you wouldn't have received back absent the tax credit)... that's a tax incentive of $7,500 -- not $0.
Whether or not you had withholdings of $7,500 only changes the timing of when you have that money in hand. It's the tax liability that really impacts whether or not the tax incentive has any value to you.
OK, I get it. I'll get my $7500 paid in, back. Late night last night.
 

Ponypower50

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timbop
I need you as my tax accountant.
I posted earlier that last year my total tax was $7481. and withheld $7645.

What do I get back from IRS? Thanks
 

timbop

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timbop
I need you as my tax accountant.
I posted earlier that last year my total tax was $7481. and withheld $7645.

What do I get back from IRS? Thanks
I replied there also. Your tax liability would be reduced to $0 (the $19 leftover from 7481-7500 gets lost), so you'd get all your withholdings back: $7645.
 

Ponypower50

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Thanks timbop
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