Number of Ford Tax Credits available for tax year 2022? (Ordered in early 2021)

[X-Gas]

I am currently anticipating an 11/1 scheduled production date (Premium, All Wheel Drive, Space White/Space Gray, Ext Battery). Based on the fact I ordered my vehicle on 4/5 I have very little faith that I will be receiving my vehicle in calendar year 2021. [insert annoyed grunt]

Based on the wording of Form 8936 (https://www.irs.gov/instructions/i8936), I need to "figure your credit for qualified plug-in electric drive motor vehicles you placed in service during your tax year."

With the Lightning being released plus other Mach-Es, what are the chances Ford blows through all 200,000 $7500 credits by end of calendar 2022?

Could I miss out on the full tax credit by Ford not getting me this vehicle within 8 months?

[insert another annoyed grunt]

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[generaltso]

Could I miss out on the full tax credit by Ford not getting me this vehicle within 8 months?

No, you’ll be fine.

 

[X-Gas]

No, you’ll be fine.

thanks General

 

[sotek2345]

thanks General

As stated you will be fine. First Ford isn't projected to run out of credits until the end of 2022. Second, the full credit continues for 2 quarters after the end of the quarter where the limit is reached.

 

[Dancefreak]

The current 200k limit likely won’t exist after this year.

 

[machefan]

The current 200k limit likely won’t exist after this year.

Hopefully but I think some of the proposed changes are stalling.

Either way the OP is good through 22. Even after that the amount changes but still available for a period longer.

 

[Bryan_GTPE]

I actually posted this in another thread, but happy to get this link out there. Unless the current bill being debated in congress passes and changes things, Ford will have about 50k rebates left going into 2022, so no worries. Now if the new legislation passes, we will need to see what the outcome of the is it a car or is it an SUV debate is. Personally to me, it’s an SUV, but feel free to debate that in the other thread.
Sorry, almost forgot the link: https://www.irs.gov/businesses/irc-30d-plug-in-electric-drive-motor-vehicle-credit-quarterly-sales

 

[ChasingCoral]

TL;DR: Ford should still be eligible for the full Federal tax credit in all of 2022 and the first quarter of 2023.

You can keep track of the sales here: IRC 30D – Plug-In Electric Drive Motor Vehicle Credit Quarterly Sales | Internal Revenue Service
Note that they haven't updated for 2021 Q4 yet.

As of the end of 2021 Q3, Ford had used up 149,595 of their 200,000 credits.
US sales of the Mustang Mach E in 2021 Q4 were 8,285 (Oct: 2,848, Nov: 3,088, Dec: 2,349).
That means Ford has sold approximately 157,880 EVs by the end of 2021.

Mach E production in 2021 was 63,683 with 27,140 of those sold in the US (more than half went to UK and EU).

If we assume the same level of sales of the Mach E in the US, expect about 6,800 sales per quarter in 2022.
If we assume sales of 20,000 F150-Lightnings in 2022, all in the last 2 quarters, that is a maximum of 10,000 in Q3 and 10,000 in Q4. However, it is likely that Lightning sales will be higher in Q4 than Q3.

This suggests that in 2022, Ford will reach
~164,700 by the end of Q1
~171,500 by the end of Q2
~188,300 by the end of Q3
~205,100 by the end of Q4
Sales of eTransits may speed this up. So would selling more of the Mach Es in the US.

In essence, Ford MAY reach the 200,000 at the end of 2022.

According to Federal Tax Credits for Electric and Plug-in Hybrid Cars
"The credit begins to phase out for vehicles at the beginning of the second calendar quarter after the manufacturer has sold 200,000 eligible plug-in electric vehicles (i.e., plug-in hybrids and EVs) in the United States as counted from January 1, 2010. IRS will announce when a manufacturer exceeds this production figure and will announce the subsequent phase out schedule (Plug-In Electric Drive Motor Vehicle Credit Quarterly Sales)."

So, if Ford surpasses the 200,000 sales in Q4 of 2022, phaseout begins Q2 of 2023. At that point the incentive on each of their vehicles is cut in half. It continues at that 50% level for the next two quarters. After that, the incentive is halved again, to 25% of its original amount, for the next two quarters. When that period expires, the credits disappear entirely.

Following this calculation, Ford BEVs should be eligible for Federal tax credits of
$7500 through 2023 Q1
$3750 2023 Q2 - Q3
$1875 2023 Q4 - 2024 Q1

This could move up a bit sooner, though, if Ford delivers more Mustang Mach Es to US customers in 2022 than they did in 2023. If ALL of them are sold in the US, that would mean:
~174,000 by the end of Q1
~190,000 by the end of Q2
~206,000 by the end of Q3

Following this calculation, Ford BEVs should be eligible for Federal tax credits of
$7500 through 2022 Q4
$3750 2023 Q1 - Q2
$1875 2023 Q3 - Q4

However, Ford has to sell enough Mustang Mach Es in the UK and EU to avoid major tariffs due to the EU fleet CO2 limits. I'm not sure how many units that is but these EU regulations make this scenario quite unlikely.

 

[machefan]

TL;DR: Ford should still be eligible for the full Federal tax credit in all of 2022..

All unknown, we can predict but the F150 EV is going to take a bite of it.

This sounds about right

"Following this calculation, Ford BEVs should be eligible for Federal tax credits of"

$7500 through 2022 Q4
$3750 2023 Q1 - Q2
$1875 2023 Q3 - Q4

Full credit for almost all of 2022, then it's going to go one way or another, but at least there will still be a credit.

 

[Mopey]

If Ford knows they are going to be within a few thousand of the 200k limit at the end of a quarter, I wonder if they might delay those few thousand sales a few weeks and thereby extend their tax credit for a full extra quarter?

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