Baseball1516
Member
- First Name
- Brian
- Joined
- Aug 11, 2021
- Threads
- 3
- Messages
- 9
- Reaction score
- 0
- Location
- NJ
- Vehicles
- Mach E Select
- Thread starter
- #1
Sorry for starting a new thread, but I am trying to get an answer before my purchase on Friday. I have reached out to my tax professional, but, with the holiday I am not confident I will receive an answer before Friday.
I understand that tax credit situation may change, but I am concerned with the current law, as I am planning on purchasing the vehicle on Friday.
My question is this; is it my total tax liability for the year that matters or the amount I may owe the IRS in April?
For example, if I make 125k a year, I clearly have paid more than $7500 to the federal government throughout the year. However, based on my withholdings, I may only need to cut a check to the IRS for 2k in April (or they may actually owe me). If I only owe the IRS 2k in April, but I paid them 25k in taxes throughout the year, am I entitled to the full benefit of the $7500 credit? If so, how does that work practically? Will the IRS cut me a check for $5500? I understand they would not cut me a check if my total tax liability was only 2k. In my hypothetical, I paid 25k in taxes throughout the year and then only owe another 2k in April.
Hope this makes sense and happy holidays!
I understand that tax credit situation may change, but I am concerned with the current law, as I am planning on purchasing the vehicle on Friday.
My question is this; is it my total tax liability for the year that matters or the amount I may owe the IRS in April?
For example, if I make 125k a year, I clearly have paid more than $7500 to the federal government throughout the year. However, based on my withholdings, I may only need to cut a check to the IRS for 2k in April (or they may actually owe me). If I only owe the IRS 2k in April, but I paid them 25k in taxes throughout the year, am I entitled to the full benefit of the $7500 credit? If so, how does that work practically? Will the IRS cut me a check for $5500? I understand they would not cut me a check if my total tax liability was only 2k. In my hypothetical, I paid 25k in taxes throughout the year and then only owe another 2k in April.
Hope this makes sense and happy holidays!
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