✅ 8/1 Lightning Build Week Group

[ExCivilian]

Do you or anyone else have any more info on this, so called, directive?

I'm in a similar boat and stopped by my dealer today. They refused to offer any kind of binding agreement until the truck is delivered AND goes through PDI. The manager stated he has received so such communication through Ford regarding this. Thanks!

No, but I'm at a point where I don't have any faith that Ford corporate cares at all about us. If this so-called directive is true, it means Ford is deliberately going out of their way to thwart our ability to secure favorable terms in the purchase of our vehicle without any downside to them. If they didn't send that statement out, and instead are just staying silent, that's a stark difference in how Rivian and others reached out to their customers. Instead, Farley has been silent on twitter.

Sponsored

 

[Soloekahi]

I personally feel that if you get the truck this year, you will be fine regardless of the wording in the bill. Binding had a very broad definition. For instance, you placed an order and put down a good faith deposit for a truck to be built so you can buy. The dealer (might depend on state) can’t just take delivery of the vehicle and then sell it when it arrives. They must give you some time to decide on it. To me that is pretty binding. It’s ridiculous we all have to be guessing about this and they should just make it start in 2023 but that’s congress for you. Either way, you’ll be thankful when the sweet truck finally arrives.

 

[Roy2001]

New law won’t be effective until 1/1/23 right? Why you guys worry?

 

[Soloekahi]

The Bill actually has some language that makes it sound like msrp and income limits take effect immediately after signing into law. It’s kind of unclear honestly. But it’s enough to have companies like Rivian make ‘binding’ contract reservations.

 

[sotek2345]

The Bill actually has some language that makes it sound like msrp and income limits take effect immediately after signing into law. It’s kind of unclear honestly. But it’s enough to have companies like Rivian make ‘binding’ contract reservations.

It really doesn't if you read it. Income limits are very clearly 1/1/23. MSRP limits are once the IRS issues guidance, which is planned for 1/1/23, but could vary a bit. Maybe even later.

 

[RidetheLightning]

New law won’t be effective until 1/1/23 right? Why you guys worry?

Start reading from page 373 on and you won’t be so confident. Parts like the $80k thing starts whenever the Secretary of the Treasury gives guidance. Sotek seems confident that that’s around January 1 but I don’t see any reference or precedent to support that assumption. The final assembly in the US part starts as soon as it is signed into law, but we pass that test.

https://www.congress.gov/117/bills/hr5376/BILLS-117hr5376eas.pdf

 

[RidetheLightning]

It really doesn't if you read it. Income limits are very clearly 1/1/23. MSRP limits are once the IRS issues guidance, which is planned for 1/1/23, but could vary a bit. Maybe even later.

Do you have any source or precedent for that 1/1/23 date? What’s to stop guidance from being issued earlier?

 

[Soloekahi]

Page 393 of bill…

l) TRANSITION RULE.—Solely for purposes of the ap-
24 plication of section 30D of the Internal Revenue Code of
25 1986, in the case of a taxpayer that—
†HR 5376 EAS

394
1 (1) after December 31, 2021, and before the date
2 of enactment of this Act, purchased, or entered into
3 a written binding contract to purchase, a new quali-
4 fied plug-in electric drive motor vehicle (as defined in
5 section 30D(d)(1) of the Internal Revenue Code of
6 1986, as in effect on the day before the date of enact-
7 ment of this Act), and
8 (2) placed such vehicle in service on or after the
9 date of enactment of this Act,
10 such taxpayer may elect (at such time, and in such form
11 and manner, as the Secretary of the Treasury, or the Sec-
12 retary’s delegate, may prescribe) to treat such vehicle as
13 having been placed in service on the day before the date
14 of enactment of this Act.


Granted the effective date section says vehicles placed in service after dec 31, 2022 so perhaps this is really just talking about vehicles delivered in 2023 but the language is weird. But like I said…I would still treat the order as a binding contract.

I’m not a lawyer so this crap is confusing to me but it obviously has a company like Rivian scrambling so others think so as well.

 

[ExCivilian]

Binding had a very broad definition.

I would still treat the order as a binding contract.

The problem is all of the documents we've been signing explicitly state they're "non-binding." Double check your order form to verify if I'm correct or if yours says something different.

MSRP limits are once the IRS issues guidance, which is planned for 1/1/23

Are you certain about that? The outside date they are supposed to issue their guidance is 12/31/2022 unless I've read that portion incorrectly.

What’s to stop guidance from being issued earlier?

Nothing. The timeframe is from Biden signing to 12/31/22. The expectation, as discussed here and elsewhere, is that the auto manufacturers are powerful enough to lobby the guidance process for broader interpretation and/or delay.

 

[RidetheLightning]

Granted the effective date section says vehicles placed in service after dec 31, 2022 so perhaps this

Yes, except for, in “Exceptions“ on p. 393:

1. Final Assembly - effective immediately upon signing. (we’re fine, we’re made in the USA)
2. Purchase Price limitations (for trucks over $80k) - we are screwed if the truck is over $80k, it’s signed, and the Treasury Secretary issues guidance and we don’t have a binding commitment to purchase or have already purchased.
3. Transfer of Credit - don’t know what this section means.
4. Elimination of manufacturer limitations (the 200k vehicle limit) - extends until Dec 31, 2022
5. (l) below Exceptions - if you have a binding contract before it’s enacted, you still fall under the old rules.

 

[Soloekahi]

Yes, except for, in “Exceptions“ on p. 393:

1. Final Assembly - effective immediately upon signing. (we’re fine, we’re made in the USA)
2. Purchase Price limitations (for trucks over $80k) - we are screwed if the truck is over $80k, it’s signed, and the Treasury Secretary issues guidance and we don’t have a binding commitment to purchase or have already purchased.
3. Transfer of Credit - don’t know what this section means.
4. Elimination of manufacturer limitations (the 200k vehicle limit) - extends until Dec 31, 2022
5. (l) below Exceptions - if you have a binding contract before it’s enacted, you still fall under the old rules.

Yup…confusing. We are kind of a gray zone period so I guess just hope for the best. Haha. Would suck big time not to get the credit.

 

[TaxmanHog]

Do you have any source or precedent for that 1/1/23 date? What’s to stop guidance from being issued earlier?

A period of public commentary is usually given prior to final determination, when that happens give you opinion that the rules & regulations reflect the spirit of the Congress, that it should be 1/1/2023.

IMHO, they aren't willfully attempting to screw people, but with out fine oversight by lawyers and adept citizens ..... mishaps of legislation, law & implementation have happened in the past.

 

[TaxmanHog]

 

[RidetheLightning]

A period of public commentary is usually given prior to final determination, when that happens give you opinion that the rules & regulations reflect the spirit of the Congress, that it should be 1/1/2023.

IMHO, they aren't willfully attempting to screw people, but with out fine oversight by lawyers and adept citizens ..... mishaps of legislation, law & implementation have happened in the past.

Very well said and thank you. It’s heartening to hear about how it usually goes from someone who knows the tax system fairly well. The “mishaps“ of course happen, especially to those on the margins like the >$55k car crowd and >$80k truck crowd. Most people don’t have much sympathy for those buying more expensive vehicles, never mind total cost of ownership, either because of personal beliefs, a little subconscious jealousy, or both. They focus on the MSRP of the vehicle, and assume that only people with large incomes are buying them, and also assume that someone who doesn‘t have an income close to or >$150k shouldn‘t be buying one. They ignore the case of someone who may have been frugal and invested wisely most of their adult life waiting for a vehicle like this. I’m hoping those who issue the final guidance aren’t in the “no one should have assistance buying any but the cheaper, lower range EVs” camp and try to cut it off early.

Is there any way to extend the period of public commentary? Can we filibuster? Maybe we can post here and in other build week threads about our public commentary efforts.

 

[Roy2001]

Glad to see 8/1 blend date already built.