Potential future EV credit changes [NO POLITICS]

[Sam James]

Sheesh, I really hope they don't drop the income limit to $100k, I fluctuate a bit above or below that on any given year and really need to get the price on this truck closer to 30k vs 40k (Pro) to make it feasible for me otherwise it's way more economical for me to keep my old paid off gasser that gets 14 mpg on a good day.

(Politically neutral comment here)

There seems to be a HUGE disconnect between Congress and the public, with many members of both parties guilty of this. I exceed the proposed limit some, but between healthcare, taxes, retirement, mortgage, insurance, household expenses, groceries, utilities, and incidentals there isn't really all that much leftover for car payments; ICE vehicles are extremely expensive right now as it is. And do they want me to save towards my kids college tuition or not?

The cost of housing has dramatically increased and if you have kids in daycare, then God help you. One of our kids requires multiple types of therapy multiple times per week. We always exceed our out-of-pocket limits each year and so take full advantage of our HSA. We take advantage of local resources. Still, there are things like medical appliances he requires that aren't fully covered.

Anyhow, that's just me, but if the idea is to convert Americans to using electric vehicles, which generally have a higher purchase price--often at a smaller size--than ICE counterparts, then a subsidy to bring the price in-line with ICE counterparts until manufacturing and parts costs are driven down makes complete sense. Keep a rather high limit for households and a moderate limit for individuals, however. Cars are just flat-out expensive right now whatever the drive train and whether new or used.

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[corradoborg]

Sheesh, I really hope they don't drop the income limit to $100k, I fluctuate a bit above or below that on any given year and really need to get the price on this truck closer to 30k vs 40k (Pro) to make it feasible for me otherwise it's way more economical for me to keep my old paid off gasser that gets 14 mpg on a good day.

This is the point of the limits, unfortunately. They are invariably proposed by the politicians that do not want EVs to be subsidized.*

*That's not a political statement. It's a simple fact that some politicians don't want EV subsidies, or want to minimize EV subsidies. Whether or not one agrees with them is when the discussion veers into politics.

 

[JPro]

(Politically neutral comment here)

There seems to be a HUGE disconnect between Congress and the public, with many members of both parties guilty of this. I exceed the proposed limit some, but between healthcare, taxes, retirement, mortgage, insurance, household expenses, groceries, utilities, and incidentals there isn't really all that much leftover for car payments; ICE vehicles are extremely expensive right now as it is. And do they want me to save towards my kids college tuition or not?

The cost of housing has dramatically increased and if you have kids in daycare, then God help you. One of our kids requires multiple types of therapy multiple times per week. We always exceed our out-of-pocket limits each year and so take full advantage of our HSA. We take advantage of local resources. Still, there are things like medical appliances he requires that aren't fully covered.

Anyhow, that's just me, but if the idea is to convert Americans to using electric vehicles, which generally have a higher purchase price--often at a smaller size--than ICE counterparts, then a subsidy to bring the price in-line with ICE counterparts until manufacturing and parts costs are driven down makes complete sense. Keep a rather high limit for households and a moderate limit for individuals, however. Cars are just flat-out expensive right now whatever the drive train and whether new or used.

Exactly this, the middle class doesn't have the disposable income they had before. 100K today is not the 100k of 10 years ago. If I can get a Pro model at around the 30K mark though I'll definitely be getting in the EV game. If I don't qualify for a credit though I'll probably wait it out. I'm probably around 105K on the reservation list so I doubt the existing tax credit will be there by the time I take delivery. Hoping something gets passed even if it's more middle of the road, the 400k and 100k cutoffs are very weird flexes.

 

[JTmass]

I've got a paid off ICE car with 34000 miles on it. I could honestly drive it for another 8-10 years. The only reason I'm considering a Lightning is because it's electric. I have wanted a truck but the lower MPG compared to my current car, as well as the high cost of the truck has kept me from buying one.

If these "caps" are put in place for income or MSRP, then it defeats the purpose of encouraging consumers to buy EVs. I mean 100k vs 400k, ok the higher limit makes sense. But if I am losing out on 12.5k because my wife and I make over the limit then yeah, no way I'm buying it. I'd rather wait it out with my ICE vehicle and see if the price goes down in the future. Kinda not what they're trying to encourage, right?

As an aside, man, prices for everything are out of control right now.

 

[sotek2345]

Exactly this, the middle class doesn't have the disposable income they had before. 100K today is not the 100k of 10 years ago. If I can get a Pro model at around the 30K mark though I'll definitely be getting in the EV game. If I don't qualify for a credit though I'll probably wait it out. I'm probably around 105K on the reservation list so I doubt the existing tax credit will be there by the time I take delivery. Hoping something gets passed even if it's more middle of the road, the 400k and 100k cutoffs are very weird flexes.

The $400k was based on Biden's campaign promise to not raise taxes on anyone making below that.

 

[Brian Head Yankee]

As of today, the bill appears to be dead. I come to that conclusion when Nancy says it needs to pass by next November.

We can count on the current tax rebate of $7500 for the next year and likely halfway into 2023.

 

[metroshot]

As of today, the bill appears to be dead. I come to that conclusion when Nancy says it needs to pass by next November.

We can count on the current tax rebate of $7500 for the next year and likely halfway into 2023.

yah I was afraid of that happening...

at least we can hopefully claim the $7500 tax credit for 2022 if Ford makes enough Lightnings to get to my reservation order fulfilled.....

in California I would expect to see about $4500 additional post rebate checks from:
CVRP $2000
CCFP $1500
SCE $1000

 

[sotek2345]

As of today, the bill appears to be dead. I come to that conclusion when Nancy says it needs to pass by next November.

We can count on the current tax rebate of $7500 for the next year and likely halfway into 2023.

Anyone here from West Virginia or Arizona want to write their Senators?

 

[Sgt Beavis]

As of today, the bill appears to be dead. I come to that conclusion when Nancy says it needs to pass by next November.

We can count on the current tax rebate of $7500 for the next year and likely halfway into 2023.

Unfortunately I have to agree. Double Unfortunately I have to agree with Nancy Pelosi. The House Democrats have to rethink their approach on this. Conservative Democrats are being very obstructionist on this and progressive Democrats have overplayed their hand. Republicans are being Republicans.

Well, at least I can still get the current tax credit.

 

[DadBald]

Somebody please correct me if I'm wrong, but I thought the tax credit was good until the end of the calendar year in which the automotive manufacturer hit their allotment. That is - if we anticipate the credit limit being surpassed mid-2023, anyone who receives a truck in all of calendar year 2023 would be eligible.

Essentially, if everyone claims the credit at the end of the year - how will the government determine the order purchases were actually made? People file taxes at the end of January and at the beginning of April... someone who got a truck in December could file in January and get the credit while someone who got their truck in March could file the next April and miss the boat...

Is this correct?

 

[Vulnox]

Somebody please correct me if I'm wrong, but I thought the tax credit was good until the end of the calendar year in which the automotive manufacturer hit their allotment. That is - if we anticipate the credit limit being surpassed mid-2023, anyone who receives a truck in all of calendar year 2023 would be eligible.

Essentially, if everyone claims the credit at the end of the year - how will the government determine the order purchases were actually made? People file taxes at the end of January and at the beginning of April... someone who got a truck in December could file in January and get the credit while someone who got their truck in March could file in April and miss the boat...

Is this correct?

That's what I recall hearing, largely because it would be near impossible for them to regulate that as you get closer to the end. So I order my truck in March, but say I live in Texas, and don't see it until May 13th. Someone in Michigan orders in late March, but they get it May 10th. Despite my order being in first and my truck being built first, someone else buys theirs first due to transit time, so lets say that makes me miss out on the rebate. Would be unfair and also difficult on the IRS end to determine who was number 200k and who was 200,001.

 

[sotek2345]

Somebody please correct me if I'm wrong, but I thought the tax credit was good until the end of the calendar year in which the automotive manufacturer hit their allotment. That is - if we anticipate the credit limit being surpassed mid-2023, anyone who receives a truck in all of calendar year 2023 would be eligible.

Is this correct?

It is by quarter. You get 2 quarters of full credit after the 200k limit is hit. Then 2 quarters of 50% credit, then 2 quarters of 25% credit.

https://www.irs.gov/businesses/plug-in-electric-vehicle-credit-irc-30-and-irc-30d

 

[DadBald]

It is by quarter. You get 2 quarters of full credit after the 200k limit is hit. Then 2 quarters of 50% credit, then 2 quarters of 25% credit.

https://www.irs.gov/businesses/plug-in-electric-vehicle-credit-irc-30-and-irc-30d

Very interesting, thanks.

 

[greenne]

Very interesting, thanks.

Also...don't count out the fact they may make it retroactive. Some of the versions floating(now) had language reffering to a sale date of on/after 1/1/2021...even though we are several months later..

Its all still up in the air, but you could be in line for bigger tax credit if Congress passes in 2022 and makes it retro to beginning of 2022.

 

[ZDog]

Also...don't count out the fact they may make it retroactive. Some of the versions floating(now) had language reffering to a sale date of on/after 1/1/2021...even though we are several months later..

Its all still up in the air, but you could be in line for bigger tax credit if Congress passes in 2022 and makes it retro to beginning of 2022.

It’s currently looking like a real possibility no budget reconciliation bill will pass and we’ll be left with the current federal EV rebate program with the 200,000 unit provision, etc. (BTW, it’s challenging to write carefully and make only factual comments with no politics in this thread ?!)

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