Note the parts I've underlined in this transcript down towards the bottom:
Quote:
Now, as I mentioned, in previous years, you paid the full price for the vehicle and then you claimed it on your taxes and if you qualified you got the money taken off your taxes. It's different now. It's a... they call it cash on the hood because it happens at the time of purchase at the dealership, the dealers' automatically going to deduct the tax credit from the purchase price. What happens is then they file papers with the IRS and within 72 hours the IRS pays the dealer For the tax credit; whatever was claimed: $7,500 or $3,750, the dealer is made whole.
Now, the problem can happen where you originally thought you were going to qualify for the tax credit but then at the end of the year you don't. So what happens in that case? You have to pay the IRS back.
So, the only way that's going to happen is if you don't think that you're going to make the limit, like, uh, I mentioned earlier the $300,000 limit for uh, married filing, jointly. Let's say, you're projecting your income this year to be at $270,000 and then you or your significant other makes a lot more money than you expected. Now, you exceed, the $300,000 limit, you'll owe The tax credit that you got on your car to the IRS.
Now, luckily it doesn't happen the other way. Let's say you don't earn enough money to fully take advantage of the tax credit. This is how it was in previous years: if you didn't or pay enough tax or oh enough tax on the income you earned, you didn't get the full tax credit. Luckily that's changed this year. And now there's no minimum income.
So you don't have to worry about, let's say you lose your job, halfway through the year, and you've gotten the $7,500 federal tax credit and now you're not earning enough income to pay enough tax. To have a $7,500 tax liability, you would have to pay the IRS back. I mean, talk about a double whammy; you lose your job and now you got to pay them for a tax credit. That's not the case anymore. They dropped that this year. So now you don't have to worry about the lower end, but you do have to worry about the upper end. Which, I guess it's not a bad thing if you earn more money than you expected.
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What I don't know is if on the paperwork you have to have proof that you should have a $7,500 tax credit for the year purchased or if it's just no longer considered at all.
I other words, there is paperwork to fill out to get the tax credit. It may ask what you made the previous years in order to see if you "should" qualify, whether you end up qualifying or not. At the end of the year if you didn't make enough you don't owe, but I don't know if you can get the credit walking in and saying "I'm not going to owe any taxes this year."
Still, with Bolts as low as $20,000 in some parts of the country and a $7,500 State incentive, I'm seriously thinking about this. A brand new EV for $5,000... Is this true or am I dreaming?