Mach-E purchase after Inflation Reduction Act - Questions

[Xenon2090]

I plan to buy Mach-E while due to the recent Inflation Reduction Act, there are several changes in the EV purchases and tax credits (I have Kia Niro EV 2020 and plan to trade-in). I initially planned to buy Kia EV6 but it disqualified from the EV tax credit and the remained options are Mach-E and Tesla (next year). Please help on the following questions:

• Does the federal tax credit get included at the point of sale?
• Does the amount of federal tax credit depend on the annual income salary?
• Is it feasible to place a pre-order at the dealer with a deposit? If yes, is the deposit refundable?

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[mateo]

In short, if you take ownership of a Mach-E in 2022 then you will get $7500 in tax credit when you file your taxes, assuming your 2022 tax liability was at least that much. Your income doesn't matter, as far as I know.

If you take ownership in 2023, then nobody knows for sure what you would get. You would need to make less than 150k single or 300k joint in either 2022 or 2023. (I think MAGI.) Starting in 2024, the Inflation Reduction Act establishes a mechanism that will allow car buyers to transfer the credit to dealers at the point of sale so that it can directly reduce the purchase price.

You can pre-order with a (most likely) refundable deposit but all that does is give you the right to buy the car you configured when it comes. You still have to negotiate the selling price with the dealer you choose.

 

[OON7]

If you really want one before the end of the year you'll need to start checking daily on all of the car sites and be ready to inquire and act fast. I searched within 200 miles from me over the last couple of months and finally scored yesterday.

It's basically all customer abandoned orders out there, dealers are marking up because they can and they know they will sell.

 

[JohnFoxeSheets]

You should be able to find all the info you need on the IRS website.

 

[Xenon2090]

My MAGI is higher than the cap and if I want to use the tax credit, I need to buy it in this year (the tax credit does not apply at the point of sale till next year).

I hope that I can find dealers that can have Mach-E.

 

[Sam2084]

In short, if you take ownership of a Mach-E in 2022 then you will get $7500 in tax credit when you file your taxes, assuming your 2022 tax liability was at least that much. Your income doesn't matter, as far as I know.

If you take ownership in 2023, then nobody knows for sure what you would get. But if you did get anything in 2023, it would be at the point of sale. You would need to make less than 150k single or 300k joint in either 2022 or 2023. (I think MAGI.)

You can pre-order with a (most likely) refundable deposit but all that does is give you the right to buy the car you configured when it comes. You still have to negotiate the selling price with the dealer you choose.

Point of Sale rebate won’t start until 2024.

 

[mateo]

Point of Sale rebate won’t start until 2024.

Yes, you are right! I've edited my post to avoid confusing future readers with the text from https://home.treasury.gov/system/files/136/EV-Tax-Credit-FAQs.pdf.

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