Mach E Tax Planning

[efisher]

Given the nature of the$7,500 Federal tax credit, I wish there were some way that Ford could let us know if we should expect delivery of our cars in 2020 or 2021. I realize that asking for an exact date would be unrealistic but knowing the year would be helpful.

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[timbop]

Given the nature of the$7,500 Federal tax credit, I wish there were some way that Ford could let us know if we should expect delivery of our cars in 2020 or 2021. I realize that asking for an exact date would be unrealistic but knowing the year would be helpful.

yes, but given that they don't know for sure one of 2 things will happen:

1. They say 2021 and the pitchforks and torches come out because "we want our cars in 2020"
2. They say 2020 and slip until 2021, and the pitchforks and torches come out because "you promised we'd get our cars in 2020"

pretty much a kobyashi maru for Ford.

 

[GoGoGadgetMachE]

Given the nature of the$7,500 Federal tax credit, I wish there were some way that Ford could let us know if we should expect delivery of our cars in 2020 or 2021. I realize that asking for an exact date would be unrealistic but knowing the year would be helpful.

I agree. For example, there's still enough time in the year - not much, but enough - to adjust withholding if necessary, if you adjusted originally expecting that $7500 credit.

I know that there's been some statements on the site that come down to "if you care about getting $7500 this year, you can't afford the car," but that's crazy talk. I can afford the car just fine, but I still care about when I'd be getting the credit. (And that's not getting into other state-level credits that others seem to be concerned with - not a thing in Ohio.) Not sure why those would be mutually exclusive.

pretty much a kobyashi maru for Ford.

Can I pull a Jim Kirk and reprogram Ford to get us past this? ?

 

[generaltso]

Given the nature of the$7,500 Federal tax credit, I wish there were some way that Ford could let us know if we should expect delivery of our cars in 2020 or 2021. I realize that asking for an exact date would be unrealistic but knowing the year would be helpful.

Did you get a build date yet? If not, I think it's safe to assume it will be 2021.

 

[ChasingCoral]

So, my dealer just called me about this. He volunteered an option. If you have a build date in 2020, he said they can prepare an invoice for the car in 2020 even if the car will then be delivered in 2021. You can use that invoice for tax purposes. It's much like many other purchases (in fact most everything we order) where you are billed before delivery.

 

[GoGoGadgetMachE]

Did you get a build date yet? If not, I think it's safe to assume it will be 2021.

That's a completely reasonable statement for those in that situation, and one I would agree with at this point, but I have a build date (well, a build week, to be completely accurate.) The question comes back ultimately to "what's the gap from that to delivery?" which doesn't seem to be something that we have any answers to right now?

 

[GoGoGadgetMachE]

So, my dealer just called me about this. He volunteered an option. If you have a build date in 2020, he said they can prepare an invoice for the car in 2020 even if the car will then be delivered in 2021. You can use that invoice for tax purposes. It's much like many other purchases (in fact most everything we order) where you are billed before delivery.

oooh

I texted my guy and got no answer back yet. Maybe I'll go in to the dealer and ask them about this - I need to go out early this afternoon anyway.

 

[agoldman]

Given the nature of the$7,500 Federal tax credit, I wish there were some way that Ford could let us know if we should expect delivery of our cars in 2020 or 2021. I realize that asking for an exact date would be unrealistic but knowing the year would be helpful.

2020 is dreaming.. better accept the reality of early 2021. I'd be surpirsed if more than a small handful of orders on this forum are filled by end of December. We all need to adjust our expectations. This should not be surprising.

 

[abr]

So, my dealer just called me about this. He volunteered an option. If you have a build date in 2020, he said they can prepare an invoice for the car in 2020 even if the car will then be delivered in 2021. You can use that invoice for tax purposes. It's much like many other purchases (in fact most everything we order) where you are billed before delivery.

Mark - sounds like your dealer is playing with fire and your state's DMV. I'd be very skeptical that they would actually do this for real.

 

[SnBGC]

So, my dealer just called me about this. He volunteered an option. If you have a build date in 2020, he said they can prepare an invoice for the car in 2020 even if the car will then be delivered in 2021. You can use that invoice for tax purposes. It's much like many other purchases (in fact most everything we order) where you are billed before delivery.

Look up the requirements for "date placed in service". That is the most important item. A vehicle can be placed in service without actually taking possession of it. Your dealer's suggestion is likely based on many previous examples from other clients.

Hint. Think about chassis cab vehicles and what happens to those before the end user actually gets physical possession.

 

[solarmoo900]

Mark - sounds like your dealer is playing with fire and your state's DMV. I'd be very skeptical that they would actually do this for real.

Yeah, I thought the same thing. The IRS form literally states

• You placed the vehicle in service during your tax year.

Which would basically be a lie if your car wasn't even delivered until the later year

 

[DBC]

So, my dealer just called me about this. He volunteered an option. If you have a build date in 2020, he said they can prepare an invoice for the car in 2020 even if the car will then be delivered in 2021. You can use that invoice for tax purposes. It's much like many other purchases (in fact most everything we order) where you are billed before delivery.

If you care, I'd be comfortable with that. Don't make too much out of which year you take the credit. Assuming you can take it in either year, it's just a timing issue which isn't of great import. You get it this year or next year. From a tax standpoint it doesn't change the total amount of tax due and paid. The absolute worst that happens is you file an amended return, and for practical reasons that is unlikely to happen.

The first practical reason it won't happen is that the IRS won't bother looking at the issue. The IRS is concerned about people who don't buy an electric vehicle applying for the credit. That is fraud and there has been a considerable amount of it. Looking for a timing question for someone who is entitled to the credit is of far less importance.

The second practical reason the IRS won't bother is that this isn't even small potatoes. What's the actual monetary difference between $7500 in one year or the other? Given there are plenty of opportunities to bring in some big bucks, for an IRS employee, focusing on something this small is not a path to being promoted. In sports terms, this is the quintessential "no harm no foul" call.

The third practical reason the IRS won't bother is that arguably the vehicle was placed in service per the invoice. Again, given the small sum at issue, from the Service's standpoint, how much time can you waste arguing about this?

And of course the fourth practical reason is that it would be impossible from the paper to know when you took possession of the vehicle. It's not like there are cameras in the dealership.

On the other hand, absent some particular difference in the tax years, and given the interest rate environment, it doesn't seem to matter for the consumer in which year they get the credit.

 

[DBC]

In a more or less zero interest rate environment the opportunity cost amounts to a couple of lattes at Starbucks. And of course if it did matter you could just reduce your withholding or pay less estimated tax.

 

[SnBGC]

Provided I have a VIN and the vehicle has left the factory, and I make the purchase by end of the year then I am very confident I will be able to place it in service and satisfy all the IRS requirements.

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