2023 Toyota Prius - WOW!

[JSH]

Originally Posted by Isaac Zachary

Interesting comparison to the lease loophole. I had no idea that the lease loophole existed.

Which is disappointing as it has been around since 2009. However, I doubt you are alone with as many people I see saying only rich people get tax credits buying EVs.

Originally Posted by Isaac Zachary

What I can say is such loopholes don't make any sense. I'd like to ask the IRS, why is it that I can use the full tax credit at the point-of-sale but if I wait then there's a chance I may not get it?

The difference is WHO takes the credit - a business or the individual buying the car. However, it would be FAR easier and less confusing if the incentive was just a point of sale rebate. (Which is how Oregon does ours)

[JSH]

Originally Posted by cRiPpLe_rOoStEr

That's quite impressive, but just remember I am still used to see cars around 40 to 50 years-old still being daily-driven, and not even close to be heading to a scrapyard anytime soon.

I'm aware of that. I also HIGHLY doubt people will be saying the same thing 50 years from now considering the amount of electronics in a modern car.

[redpoint5]

Originally Posted by JSH

Which is disappointing as it has been around since 2009. However, I doubt you are alone with as many people I see saying only rich people get tax credits buying EVs.

Making it a point of sale credit doesn't help much, because it's older, more wealthy people who purchase new cars. Most car sales are used cars. The average age of a new vehicle buyer is 54.

I'm trying to think, and none of my close friends have ever bought a new car, and they're pharmacists and vets.

... one of my friends bought a new Leaf about a year ago because he has a medium length commute to Portland, and used car prices made new car prices seem less imposing. He gets buy charging on a regular 120v outlet.

The real malfeasance is that the tax credit hasn't done a cost / benefit analysis. You'd think before spending (which is the same as not collecting) billions of dollars, you'd have a plan. Not in government. Ready, FIRE, aim, with your tax money, and to the benefit of the wealthy.

Nobody even challenges me on this point in the slightest because there is no explanation except corruption or ignorance, and somehow we're delighted to live in such an absurd world.

[freebeard]

and somehow we[']re delighted to live in such an absurd clown world.

i.redd.it/jp7j30xv5uu21.png

[Isaac Zachary]

Originally Posted by JSH

Which is disappointing as it has been around since 2009. However, I doubt you are alone with as many people I see saying only rich people get tax credits buying EVs.

Of course to jump through the hoops to just get a tax credit via leasing means learning a whole new way of obtaining a vehicle. In other words, it opens up a can of questions (they might be wormy questions) that I'd need answered. Do I get to purchase the vehicle after I lease it? How would that compare to someone buying a new one and getting a full tax credit? What if I go over the mileage limit during the lease? I did over 30,000 miles the first year I had the Avalon, for an example. Does having a lease mean I get free oil changes at a dealer hundreds of miles away (or at least 70 miles to the nearest dealer)?

Originally Posted by JSH

The difference is WHO takes the credit - a business or the individual buying the car. However, it would be FAR easier and less confusing if the incentive was just a point of sale rebate. (Which is how Oregon does ours)

Yes, less confusing would be very welcome IMO! It sounds like an easy way to shoot yourself in the foot. For an example, I'm self employed. Knowing I'd get a large tax rebate at the end of the year might sound easier to do than to make it a point-of-sale and have to make quarterly tax payments. But if I owe $3,728 in income tax at the end of the year, then the IRS can keep the other $3,272 instead of being able to use that to pay the 15% self-employment tax (or some other payment or purchase).

But I think I got it now. Get it as a point-of-sale rebate, pay the quarterlies, and just keep swiming!

Originally Posted by redpoint5

Making it a point of sale credit doesn't help much, because it's older, more wealthy people who purchase new cars. Most car sales are used cars. The average age of a new vehicle buyer is 54.

In theory that should make the used car market even cheaper. There's also going to be a tax credit/point-of-sale rebate for used EV's from what I understand.

[redpoint5]

Originally Posted by Isaac Zachary

In theory that should make the used car market even cheaper. There's also going to be a tax credit/point-of-sale rebate for used EV's from what I understand.

Which is further evidence of the corruption and ineptitude of our so-called genius leaders. There is no economic theory of how subsidies for used EVs lowers CO2. Not only that, but subsidies are largely captured by the manufacturers and dealerships because buyers already apply the discount in their mind, and the manufacturers and dealerships raise the price to the intersection of supply and demand.

None of this is lost on anyone that passed 10th grade econ, but apparently 80% of us failed.

[Isaac Zachary]

Originally Posted by redpoint5

Which is further evidence of the corruption and ineptitude of are so-called genius leaders. There is no economic theory of how subsidies for used EVs lowers CO2. Not only that, but subsidies are largely captured by the manufacturers and dealerships because buyers already apply the discount in their mind, and the manufacturers and dealerships raise the price to the intersection of supply and demand.

None of this is lost on anyone that passed 10th grade econ, but apparently 80% of us failed.

Maybe the first car owner will get more for his used EV and be more likely to buy another new EV???

[freebeard]

Remember Cash for Clunkers?

[redpoint5]

Originally Posted by freebeard

Remember Cash for Clunkers?

Next will be cash for off-lease private jets and yachts. We'll reduce CO2 emissions by helping rich folk into ultra luxury vessels that are 10% more fuel efficient, while actually just shoveling money into the pockets of the vessel maker's pockets.

Saving the planet starts with marginally more efficient private flights to Davos, oh, and the Proles will eat bugs.

[Hersbird]

Originally Posted by JSH

I'm not a lawyer either but I can read the text. It says "the credit which would be allowed to such taxpayer" and then clarifies "with respect to the vehicle for
which the credit is allowed under subsection (a)" Section A has specific rules for what credit is allowed per vehicle. None of that section deals with income or taxed owed.

If you just took the credit yourself it would be nonrefundable and limited to the taxes you owe in the year you buy the car. If you transfer the credit to the dealer - it is no longer based on your income. Just as if you lease an EV the credit is not based on the buyer's income or taxes. For years people that don't make enough money to pay $7500 in taxes have been leasing EVs so that they can get the full $7500. Nothing changed for that lease "loophole" in the IRA and congress specifically added the option to buy the car and still get the full credit at point of sale. Personally I don't think this was an error or a loophole. Congress laid out rules that would make the credit more palatable to the general public that have been talked about for months - and then wrote in an exception that would allow FAR more people to take the credit.

However - if I'm wrong about this there is still the lease "loophole" for those that don't pay $7500 in federal income taxes. Nothing changed there. At the end of the day someone that doesn't pay a dime in income taxes can still get the full credit.

But then if it's based on the dealership income or company income either lease or this point of sale, don't those places make over the income cap and therefore make them ineligible?

It was a terrible bill slapped together last minute and done with big chunks in backrooms away from public scrutiny.

It will be a wait and see how the IRS interprets it because that's what will matter. Right now, don't have $7500 in tax liability, you don't get $7500. Make over $150,000 which would give you thar much in liability and you don't qualify for $7500. There is this narrow range of incomes that actually maximize the credit. Probably a single person making from $80,000 to $150,000 or a married couple making from $120,000 to 300,000.

I saw an article talking about getting both the maximum Oregon $7500 rebate and the max federal $7500 credit but I pointed out I didn't think this would be possible as the max income for the Oregon $5000 low to medium income rebate is $50,000. If you had kids that could go up, but then you have so many federal deductions you won't hit a $7500 liability there.