Quote:
Originally Posted by JSH
Most people don't do math when buying a car. They go into a dealer with a price per month in their head that they are willing to pay - and then let the dealer do the math. It is all about the monthly payment and on a PHEV (or EV) that payment doesn't include the discount for the tax credit. (I think we will see more of both EVs and PHEVs sold when the tax credit becomes a point-of-sale rebate in 2024)
The typical person can't tell you how much they spend on gas let alone tell you the cost per mile to fuel their car. Less than 1/3rd of households have a budget or track spending by category.
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This is very true. Of course, if you're getting a $30,000 loan and paying $600 per month, a 30mpg vehicle @ 1250 miles per month @ $4 per gallon is only $167 per month, quite a bit less than the monthly payment.
But if you're more frugal and get a loan for under $10,000, then the fuel costs for even an average driver can start creeping up past the cost to finance the vehicle.
Of course that's starting from zero. Someone who sells or trades in a used car gets back part of what they invested into it, for an example.
Quote:
Originally Posted by JSH
(I think we will see more of both EVs and PHEVs sold when the tax credit becomes a point-of-sale rebate in 2024)
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Despite rumors, according to the IRS the tax credit will still be "non-refundable" even after it becomes point-of-sale. So you can't owe less than the tax credit at the end of the year to benefit from all of it. If you get the full credit applied at the point of sale but then owe less at the end of the year you'll have to pay that back. That throws pretty much all median wage or less earners out from being able to get the full credit or $7,500. A married couple filing jointly that makes $70,000 will owe around $4,900 if they don't have any other deductions. If they have kids that owed tax will be even less, so less of a credit can be applied without having to pay part of it back at the end of the year.