No more waiting for EV tax credits for US.

A few months back I visited Hyundai dealership about the Ioniq 6. Over 12k mark up. Over $9k for “EV Charge” and $3k for “premium package “.
Hyundai and Kia are known for markups.
A father and son have a YouTube channel about buying cars. The dad is an ex car salesman for 40 years.
They went to Hyundai, Toyota, Mercedes and another dealership and walked around each lot.
They could believe the markups. This was a few months ago.


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no! no!

The only way you will be able to get any amount of tax credit is to lease a vehicle from a manufacture that will reduce the capitalization cost by the tax credit amount and buy the car at the residual amount.

I don't believe the law states how long the lease needs to last. So in theory you could terminate the lease early if you normally pay cash. If the lessor allows you to, buy the car the next day by paying the residual amount. The question is will the lessor allow it and is it worth doing.

 

I thought the video made it abundantly clear that one has to have the a tax liability equal to or greater then the tax credit. The IRS has said the tax credit it not refundable!

Folks better set down with a tax advisor before buying an EV and taking an advanced tax credit.

 

According to the IRS website, Hyundai does not manufacture a vehicle that is eligible for the Federal Tax Credit. Neither do Kia, Mercedes or Toyota.

You seem to be suggesting that dealers will be, or are currently, marking up prices because of the tax credit, yet the manufacturers and one model that you mentioned don’t qualify for the credit.

Out of curiosity I looked at the inventory of a local dealer via their website. They had 8 2023 Ionic 6’s in stock. Two were marked up, 3 were at MSRP and 3 were discounted. My best guess is that something other than the tax credit is what has motivated the dealer to price their vehicles as they have. Perhaps someone will come in and pay above MSRP for one reason or another. Maybe a customer will buy one at MSRP because it is nearly identical to the one that is marked up.

 

Please read the last sentence of the attachment from the Treasury Department in Post #10.

If that isn’t clear enough, I’d recommend that each individual perform their own due diligence rather than listen to the guy in the video.

 

Ok.
I tried.
I’m done. Haha


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A vehicle lease agreement typically allows exactly what you’ve described to occur. There is a “buy out” amount shown on the document that is applicable at the beginning of the lease and a reduced “buy out” amount that is applicable at the end of the lease. The vehicle can be bought out and the lease will be terminated at any time. The buyer may be out $500 or so for processing fees, but would still be ahead by roughly $7000.

That might be worth it to some folks.

 

I wonder if someone will challenge the IRS rule in court.

 

That’s always a possibility. Heck, the entire Inflation Production Act could be challenged.

Until a challenge is brought forth and is successful, what is important is understanding the rules as they currently exist.

 

Well I agree with the guy in the video. Even the IRS has said the tax credit is not refundable.

By coming out with this rule that we are not going to seek recapture, they have basically made the tax credit refundable. It will be interesting to see if they get dragged into court.

 

Is the IRS saying that it is refundable? Or, is it just the guy in the video who is saying that it’s refundable?

Does transferring the credit to a dealer, who then reduces the price of a vehicle to a buyer by the same amount, make it refundable? The buyer is not entering the transaction on their tax return, let alone receiving a refund.

I’m a bit cautious about agreeing with someone who appears to be putting words in the mouth of the IRS.

 

Dont these credits have goegraphical battery content requirements? I wonder if those also apply to the used ev credit...

 

A little research eliminates a great deal of wondering.