IRS releases new EV credit rules - effective 4/18/23

[4sallypat]

It's not just the Ioniq 5 - "lease + buyout" has been the norm for ID.4s back in 2021 and early 2022. Wrangler 4xE owners were doing it too.

Today... there are numerous carmakers who offer $7500 cap reduction on leases - Mercedes, Volvo, Polestar, Nissan, VW, Hyundai, Genesis, Jeep, BMW. Nissan does not allow buyouts though.

Kia is offering $5K off on EV6 leases too.

The crazy part is IRA might have the opposite effect long-term with this loophole. Many non-US carmakers are offering $7500 reduction on leases and US carmakers are not. If you exceed income limits (cough, cough) then buying a US made car is more expensive than a foreign built one with a lease credit.

Thanks for the summary and lease pass thru...

Based on the recent email from Ford, my MME won't arrive before the tax credit cut.

Now looking at the VW iD4 and BMW i4 / iX.

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[RickMachE]

Thanks for the summary and lease pass thru...

Based on the recent email from Ford, my MME won't arrive before the tax credit cut.

Now looking at the VW iD4 and BMW i4 / iX.

In your situation, why wouldn't you just keep the truck? I thought your wife was driving something else, and wasn't going to drive the Mach-E, and you were selling the truck and taking the Mach-E? Given that, and current truck value, won't you take a bath?

 

[4sallypat]

In your situation, why wouldn't you just keep the truck? I thought your wife was driving something else, and wasn't going to drive the Mach-E, and you were selling the truck and taking the Mach-E? Given that, and current truck value, won't you take a bath?

That's the rub!

I really wanted to switch over to the MME as it's more practical and easier on my daily commute drive.

The full tax credit is important for me as I qualify for it and claimed it on my '22 Lightning.

Getting half credit because Ford could not transport it within a reasonable time period from December 2022 is causing my dilemma.

As for the Lightning value, I have a buyer with a deposit, who is patiently waiting and agreed on the price which is above MSRP.

My options:

• Keep the Lightning, walk from the MME, return Lightning deposit = full tax credit received and not a single issue 10 months in.
• 
  
• Buy the MME and sell the Lightning - remain angry at Ford plus uncertain MME reliability.
• 
  
• Lease VW or BMW to capture the full tax credit and then buy it out.

 

[snowdoggie]

Not sure if already covered; got one of my MME Dec 28 2022, doing my taxes now on HR Block and it is telling me I will only get 2500 Plug in Electric Vehicle Credit - For vehicles with four or more wheels, we look at the amount of tentative credit you entered (7500) and your taxes after other credits. Your credit is the smaller of these two.
Can anyone enlighten me why I am losing 5k in credits? We made under 300k that year

 

[dbsb3233]

Not sure if already covered; got one of my MME Dec 28 2022, doing my taxes now on HR Block and it is telling me I will only get 2500 Plug in Electric Vehicle Credit - For vehicles with four or more wheels, we look at the amount of tentative credit you entered (7500) and your taxes after other credits. Your credit is the smaller of these two.
Can anyone enlighten me why I am losing 5k in credits? We made under 300k that year

Look at your TAX liability before the credit (1040 Line 16). If that's over $7500, you should be able to subtract the full $7500 (usually on line 20). Sounds like you're only showing $2500 in actual tax liability, but that would be really odd for that much income.

 

[Bayviews88]

Maybe that’s true for where you live but it certainly isn’t here from what I can see. I wish I had the time to research and or go out of state to buy. I will end up rolling the dice and hoping Ford does what’s right after April 18th. Part of the problem in California is that people are more than willing to pay huge markups. When I was looking last year $10k was the norm.

Hey @Haleigh,
Have you called dealers in the SF Bay Area? Several still have inventory of 2023 Mach-Es this week at MSRP + no add-ons (E.g. Walnut Creek Ford). It might be worth a $200 one-way flight + BART ride to Walnut Creek to bring a Mach-E home with a net $7,300 credit before Tuesday.

 

[RosemarieS.]

The NPRM is filed for public inspection and will be published in the Federal Register on April 17, 2023. Vehicles placed-in-service on or after April 18, 2023 will be subject to the critical mineral and battery component requirements laid out in the rule. On that date, FuelEconomy.gov will contain a list of eligible clean vehicles that qualified manufacturers have indicated to the IRS meet the requirements to claim the new clean vehicle credit, including the amount of the credit.

Matt, I joined this website to ask about the Clean Vehicle Credit. This interface is very confusing, so forgive me if I make a mistake. The IRS says " Sellers of vehicles that are eligible for a new clean vehicle credit under IRC 30D must furnish a report to the buyer at the time of the sale and then to IRS for those vehicles to be eligible for a credit under IRC 30D"
If you brought home your 2023 MachE between Jan 1, 2023 and April 18, 2023, you should be able to get the full $7500 credit, per my tax accountant. The problem is that one will not qualify if the "seller" doesn't send a REPORT to the IRS. Who is the seller...Ford Motor Company? A local dealer?
I was wondering if anyone has successfully gotten a "REPORT" from a dealer or had a "REPORT " submitted to the IRS? (I brought my MME home 1/3/23.)

 

[RickMachE]

Matt, I joined this website to ask about the Clean Vehicle Credit. This interface is very confusing, so forgive me if I make a mistake. The IRS says " Sellers of vehicles that are eligible for a new clean vehicle credit under IRC 30D must furnish a report to the buyer at the time of the sale and then to IRS for those vehicles to be eligible for a credit under IRC 30D"
If you brought home your 2023 MachE between Jan 1, 2023 and April 18, 2023, you should be able to get the full $7500 credit, per my tax accountant. The problem is that one will not qualify if the "seller" doesn't send a REPORT to the IRS. Who is the seller...Ford Motor Company? A local dealer?
I was wondering if anyone has successfully gotten a "REPORT" from a dealer or had a "REPORT " submitted to the IRS? (I brought my MME home 1/3/23.)

You are making something out of nothing. The IRS will have your VIN, and know that the vehicle qualifies.

 

[4sallypat]

Matt, I joined this website to ask about the Clean Vehicle Credit. This interface is very confusing, so forgive me if I make a mistake. The IRS says " Sellers of vehicles that are eligible for a new clean vehicle credit under IRC 30D must furnish a report to the buyer at the time of the sale and then to IRS for those vehicles to be eligible for a credit under IRC 30D"
If you brought home your 2023 MachE between Jan 1, 2023 and April 18, 2023, you should be able to get the full $7500 credit, per my tax accountant. The problem is that one will not qualify if the "seller" doesn't send a REPORT to the IRS. Who is the seller...Ford Motor Company? A local dealer?
I was wondering if anyone has successfully gotten a "REPORT" from a dealer or had a "REPORT " submitted to the IRS? (I brought my MME home 1/3/23.)

You are making mountain out of a molehill.

You don't have to worry about the dealer submitting your info to the IRS at the end of the year.
That's on them - the dealer is responsible at the end of the calendar year.

You just have to worry about being under the income cap and eligible to receive the credit assuming you have enough tax liability.

 

[Haleigh]

Hey @Haleigh,
Have you called dealers in the SF Bay Area? Several still have inventory of 2023 Mach-Es this week at MSRP + no add-ons (E.g. Walnut Creek Ford). It might be worth a $200 one-way flight + BART ride to Walnut Creek to bring a Mach-E home with a net $7,300 credit before Tuesday.

My dealership found a vapor blue select which is what I ordered. I’m paying $500 over MSRP which for me is reasonable to guarantee the rebate. I pick it up tomorrow. I really wanted the vapor blue which wasn’t as easy to find as space white, red and black. Three kids in school don’t really have the option to fly up and drive back. I’m happy with the deal I’m getting and ready to drive my new baby home.

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