Tax Credit Reality

[Smokewagun]

So, I’m considering that with the mileage I drive monthly, snd gaining a $7,500 tax credit in 2023 for my 2022 Lightning purchased in 2022, I could save about $16,000 in two years.
What I can’t seem to find is, how this tax credit works. Is the credit limited to a specific TOTAL number of BEV’s sold by Ford in 2022, or is it limited to a specific number for the Lightning?
Then, how are the tax credits regulated? By a form filled out at the purchase of the truck? Or is it the first ones to fill out 2022 taxes and claim a credit? I am pretty certain I’ll be in the first bucket to order, and if the credit is not available to me, I’d likely pass on a Lightning. So how do I know if I’m in the 100,000 credits (or whatever number is picked) for the 2022 Lightning… or if it’s the 100,000 credit bucket for all Lightning’s, Mach-E’s, Transits, etc.?

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[jefro]

Still really unknown.

I think one part basically a lot of BEV, PHEV's for many years so it won't be a single year deal. The last deal was a collection of all the makers offerings so yes, van, car, truck adds up.

One of the suggestions is that if your tax is over $12.5K then you subtract one line from the other.

The other part is a section where you might owe less say $10K total tax. The IRS would credit you $2.5K back.

Another part of it says you might be able to assign it to dealer and in theory get that amount off top.

Until bill gets signed and until IRS rules on how they will implement it we can't say.

 

[astricklin]

Nothing has passed yet so here is what is currently in effect


The current credit is reported using form 8936.
"Instructions for Form 8936 (01/2021) | Internal Revenue Service" https://www.irs.gov/instructions/i8936

The current credit is non refundable so if you have a total tax liability of less than $7500 you will get a lesser amount. See you previous years tax return if your financial situation will be similar. If you are unsure, consult a tax professional.

The vehicle limit is 200,000 total sold by the manufacturer. But then there is a phase out period.
The phaseout begins in the second calendar quarter after the quarter in which the 200,000th vehicle was sold. Then the phaseout allows 50% of the full credit for 2 quarters, 25% of the full credit for 2 additional quarters, and no credit thereafter.

You can see the current status here
"Federal Tax Credits for All-Electric and Plug-in Hybrid Vehicles" https://www.fueleconomy.gov/feg/taxevb.shtml

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