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I understand the whole we won't know until march thing that is not a issue to me.
It's up to $7500
My understanding is you need tax liability not tax debt.
SITUATION A
Joe and Sarah are married and paid 22k in federal tax in 2023 on 200k of income, they are scheduled to get a 1k refund and had purchased a qualifying EV in Feb 2023. When the taxes are filed in April 2024 they would receive $7500 for ev credit plus 1k due for a total of $8500.
OR
SITUATION B
For ex. Joe and Sarah are married and paid 22k in federal tax in 2023 on 200k of income, they owe $8,700 and had purchased a qualifying EV in Feb 2023. When the taxes are filed in April 2024 they would receive receiver $7500 and would now owe $1200 in federal taxes.
My understanding is it's situation A as it's based on taxes paid not owed is this correct?
I’m going to bump this because I would like to know as well. As far as I understand, the answer is A.
Did allot of research since posting this. The internet has allot of false information and the IRS wording is confusing. The EV credit is non refundable the solar credit is refundable. Difference is refundable means you can carry over the credit to the following year and non refundable is only valid in the year you filed, 2024 if buying a ev in 2023.
The the ev tax credit as of now is $7500. Credit being the key word here. A credit reduces the amount of taxes paid. Basically if you make under the irs limits and purchasing a qualifying car you will get back the full amount as long as you paid $7500 in federal taxes.
Ex. Chris paid $9800 in federal taxes, he does his taxes and is getting a $1 refund. He then files out irs form 8936 for the ev he purchased. As mentioned before he is owed $1 as he paid the correct amount of taxes throughout the year. The credit will now reduce his taxes by $7500. Since Chris paid all year he is now due a refund of $7501 after the credit.
Hopefully the irs keeps the credit until end of March or later. Can’t imagine this admin will want the ev credit to be cut in half.
I initially thought I would have to adjust my withholding, but learned that wasn’t the case. As long as you pay that amount in taxes for the year you will get the full credit (if the car and your income meet eligibility).
My issue is it’s late in the game and in March they will issue “new guidance,” which possibly means the full credit will no longer happen.
I initially thought I would have to adjust my withholding, but learned that wasn’t the case. As long as you pay that amount in taxes for the year you will get the full credit (if the car and your income meet eligibility).
My issue is it’s late in the game and in March they will issue “new guidance,” which possibly means the full credit will no longer happen.
Day late and dollar short.
Same boat my est time frame for delivery is 3/3 - 3/31. Historically the IRS is slow and this is the busiest time of the year. I just hope march guidance means what ever they decided doesn't start until 2024 or until after may 1. They should honor all orders made prior to the new guidance and I wouldn't be shocked if that happened, all they have to do for 2024 would be modify form 8936 or issue a new one for 2024.
Our lovely president is so pro EV and he mentioned it in his state of the union. They raised the cap to 80k to help GM and Ford, they know that both can't meet the battery requirement. It's possible Tesla 3 and Y will qualify still as they are made in USA along with the batteries, depends on how they figure out the minerals portion. I could see them being tricky. China sells lithium to India who is a "partner" with usa then India sells to Tesla and now the mineral portion is met! I think it comes down to this. Biden administration hates Elon Musk so therefore hates Tesla, is the dislike for Tesla so strong that they will decimate Ford and GM's Ev sales to slow down Tesla or will they just eat it and allow the full credit to continue longer until its realistic for Ford and GM to meet the battery requirements.
My ordered car's price has increased 2k since I ordered and the timeline has been pushed for new orders until May. If I loose the credit then it will hurt a contractor as I have a bid for $5400 to do a patio, I will save 4k by doing it myself and that's what will happen if I don't get the full credit. I'm 100% capable of doing the job, I just don't want to do it!
I'm all in I ran 46ft of 6/3, 50 amp circuit using a nema 14-50 outlet last weekend. My garage is ready for the EV.
Same boat my est time frame for delivery is 3/3 - 3/31. Historically the IRS is slow and this is the busiest time of the year. I just hope march guidance means what ever they decided doesn't start until 2024 or until after may 1. They should honor all orders made prior to the new guidance and I wouldn't be shocked if that happened, all they have to do for 2024 would be modify form 8936 or issue a new one for 2024.
Our lovely president is so pro EV and he mentioned it in his state of the union. They raised the cap to 80k to help GM and Ford, they know that both can't meet the battery requirement. It's possible Tesla 3 and Y will qualify still as they are made in USA along with the batteries, depends on how they figure out the minerals portion. I could see them being tricky. China sells lithium to India who is a "partner" with usa then India sells to Tesla and now the mineral portion is met! I think it comes down to this. Biden administration hates Elon Musk so therefore hates Tesla, is the dislike for Tesla so strong that they will decimate Ford and GM's Ev sales to slow down Tesla or will they just eat it and allow the full credit to continue longer until its realistic for Ford and GM to meet the battery requirements.
My ordered car's price has increased 2k since I ordered and the timeline has been pushed for new orders until May. If I loose the credit then it will hurt a contractor as I have a bid for $5400 to do a patio, I will save 4k by doing it myself and that's what will happen if I don't get the full credit. I'm 100% capable of doing the job, I just don't want to do it!
I'm all in I ran 46ft of 6/3, 50 amp circuit using a nema 14-50 outlet last weekend. My garage is ready for the EV.
Good luck on the tax credit. We will see what happens soon enough. Tried to rep you but apparently have already done so one too many times.
Good luck on the tax credit. We will see what happens soon enough. Tried to rep you but apparently have already done so one too many times.
Hahahah, I’m a very repable person! I may get lucky and get the full credit. Taking delivery March 6, it’s possible it could move up a few days.
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