Personal Question on EV Rebates and Income Requirements (California)
10-18-21, 01:10 PM
#16
We're looking at this from different perspectives but we're both correct. The key point is you do have to have a minimum of $7,500 in federal tax liability to utilize the full $7,500 federal tax credit. That's separate from the accounting for your payroll withholding or any estimated payments you've made. If you have already paid $7,500 via estimated tax payments or withholding etc, then yes would you get 7.5K back - but it's refund of what has now become overpaid withholding, not a refund of the EV credit itself. If you have only $5,000 total fed tax liability, then you're only soaking up 5K of the EV credit - you won't see the extra 2.5K. You'd get your 5K back if you had paid it via withholding etc. Same principle as before. If you have a 7.5K liability, but haven't made any estimated/withholding payments, the 7.5K you otherwise owe is offset by the credit.
The main point was that if you have no liability, you're simply unable to use the credit and you're not seeing any of the 7.5k. There's no refund for tax you haven't paid. And if you have more than zero but less than 7.5K, you're not getting the difference in the form of a refund. You can't turn a 5K liability into a 2.5K refund because you qualified for a 7.5K EV credit. You turn that 5K liability into zero, and whether you get any actual cash back depends upon whether you'd already paid the 5K or not.
The main point was that if you have no liability, you're simply unable to use the credit and you're not seeing any of the 7.5k. There's no refund for tax you haven't paid. And if you have more than zero but less than 7.5K, you're not getting the difference in the form of a refund. You can't turn a 5K liability into a 2.5K refund because you qualified for a 7.5K EV credit. You turn that 5K liability into zero, and whether you get any actual cash back depends upon whether you'd already paid the 5K or not.
10-18-21, 02:01 PM
#17
Pole Position
The point all along was simply that you have to have a federal tax liability to take advantage of a federal tax credit.
One reason this point even comes up was that it might surprise many that a lot of American households don't pay any federal income tax (or pay very little). By some reports, well over half of all households didn't have a federal tax liability last yea (partly for pandemic reasons, but the number was already hovering around half anyway). That's one of the reasons why these credits can be a bit controversial as they tend to benefit those at the upper end of the income spectrum. The argument that these credits enable people who already do pretty well to buy an even nicer car are broadly just as valid as those that focus on the environmental benefits etc. These aren't credits that everyone can actually take advantage of. More people than we might think just don't make enough to have enough of a federal liability to qualify.
Last edited by swajames; 10-18-21 at 02:04 PM.
10-18-21, 05:37 PM
#18
Yes. The point is, if you can affort a Model S you don't need a tax credit. When we bought our Model 3, there were CA tax credits, but I did not qualify.
You can also make the point that if you need a tax credit to buy a Tesla, maybe you can't afford a Tesla.
Your results may vary...
You can also make the point that if you need a tax credit to buy a Tesla, maybe you can't afford a Tesla.
Your results may vary...
10-18-21, 06:13 PM
#19
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Yes. The point is, if you can affort a Model S you don't need a tax credit. When we bought our Model 3, there were CA tax credits, but I did not qualify.
You can also make the point that if you need a tax credit to buy a Tesla, maybe you can't afford a Tesla.
Your results may vary...
You can also make the point that if you need a tax credit to buy a Tesla, maybe you can't afford a Tesla.
Your results may vary...
10-18-21, 06:24 PM
#20
Lexus Fanatic
iTrader: (20)
but yes, your logic is correct.
By some reports, well over half of all households didn't have a federal tax liability last yea (partly for pandemic reasons, but the number was already hovering around half anyway). That's one of the reasons why these credits can be a bit controversial as they tend to benefit those at the upper end of the income spectrum. The argument that these credits enable people who already do pretty well to buy an even nicer car are broadly just as valid as those that focus on the environmental benefits etc. These aren't credits that everyone can actually take advantage of. More people than we might think just don't make enough to have enough of a federal liability to qualify.
10-18-21, 06:27 PM
#21
Lexus Fanatic
iTrader: (20)
but they're still helping chevy and ford and vw i believe.
even more ludicrous would be a tax credit for a lucid.
10-18-21, 06:44 PM
#23
Lexus Test Driver
$100K is only 'working class' in a state like california.
but yes, your logic is correct.
exactly. the tax credits helped tesla enormously by allowing them to either price cars higher than they would have without them, or price them knowing the credits will make them more competitive with ICE vehicles.
ha, good point.
but yes, your logic is correct.
exactly. the tax credits helped tesla enormously by allowing them to either price cars higher than they would have without them, or price them knowing the credits will make them more competitive with ICE vehicles.
ha, good point.
Nothing wrong with taking advantage of government incentives. It drives the segment to spend when there may be hesitation. The new incentives though have a cap so that Rivian i've been eyeing won't qualify. I may have to go to a lower class segment and go Model Y...big savings there.
10-18-21, 08:23 PM
#25
I dunno about other makes, but there are no dealer markups on Teslas. Of course, there is no Federal incentive either.
10-18-21, 08:27 PM
#26
10-20-21, 09:25 AM
#27
Nissan Leaf is still eligible for full federal tax credit. I’ve claimed it 4 times for a total of $30,000 in tax savings. 2015, 2018, 2019 & 2020.
After dealer discounts, factory rebates and tax credit my net cost to swap yearly is close to nothing. My 2019 was totaled. When I bought a 2020 replacement I came out $2000 in my pocket after insurance payout, tax credits, discounts and rebates
The leaf isn’t as sexy as a Tesla but it’s fun to drive, nimble, no maintenance and very reliable.
After dealer discounts, factory rebates and tax credit my net cost to swap yearly is close to nothing. My 2019 was totaled. When I bought a 2020 replacement I came out $2000 in my pocket after insurance payout, tax credits, discounts and rebates
The leaf isn’t as sexy as a Tesla but it’s fun to drive, nimble, no maintenance and very reliable.
Last edited by FLYCT; 10-20-21 at 09:33 AM.
10-20-21, 09:37 AM
#28
Lexus Test Driver
Nissan Leaf is still eligible for full federal tax credit. I’ve claimed it 4 times for a total of $30,000 in tax savings. 2015, 2018, 2019 & 2020.
After dealer discounts, factory rebates and tax credit my net cost to swap yearly is close to nothing. My 2019 was totaled. When I bought a 2020 replacement I came out $2000 in my pocket after insurance payout, tax credits, discounts and rebates
The leaf isn’t as sexy as a Tesla but it’s fun to drive, nimble, no maintenance and very reliable.
After dealer discounts, factory rebates and tax credit my net cost to swap yearly is close to nothing. My 2019 was totaled. When I bought a 2020 replacement I came out $2000 in my pocket after insurance payout, tax credits, discounts and rebates
The leaf isn’t as sexy as a Tesla but it’s fun to drive, nimble, no maintenance and very reliable.
10-20-21, 09:51 AM
#29
The only issue with the Leaf is that its not a long term keeper due to the air cooling on the batteries. Degradation tends to be much higher without liquid cooling. I see the Leaf as a supplemental EV for city use only. A Tesla is more of a daily ICE replacement and of course higher cost.
My 2020 Leaf was my 61st new car since 1970 so I’m not a long term keeper. It fits our mission perfectly. The Leaf SL plus has an honest over 200 mile range. We routinely travel 125 miles between home and cabin and then locally. Charging at both ends. With Florida electric rates of 10cents/kW it costs 2-1/2 cents per mile.
I don’t fit comfortably in a Tesla 3. I like the Y my friend has but I can buy 2 Leafs SL Pluses for the price if the Y.
If I could get a decent tax credit I would consider a Tesla Y.
10-20-21, 09:58 AM
#30
Lexus Test Driver
Lack of Battery cooling had an effect on degradation. In Florida I loose about 3-4% per year.
My 2020 Leaf was my 61st new car since 1970 so I’m not a long term keeper. It fits our mission perfectly. The Leaf SL plus has an honest over 200 mile range. We routinely travel 125 miles between home and cabin and then locally. Charging at both ends. With Florida electric rates of 10cents/kW it costs 2-1/2 cents per mile.
I don’t fit comfortably in a Tesla 3. I like the Y my friend has but I can buy 2 Leafs SL Pluses for the price if the Y.
If I could get a decent tax credit I would consider a Tesla Y.
My 2020 Leaf was my 61st new car since 1970 so I’m not a long term keeper. It fits our mission perfectly. The Leaf SL plus has an honest over 200 mile range. We routinely travel 125 miles between home and cabin and then locally. Charging at both ends. With Florida electric rates of 10cents/kW it costs 2-1/2 cents per mile.
I don’t fit comfortably in a Tesla 3. I like the Y my friend has but I can buy 2 Leafs SL Pluses for the price if the Y.
If I could get a decent tax credit I would consider a Tesla Y.