Looks like Tesla knows how to do it right, unlike Rivian that managed to blow it big time for a lot of folks. Buyer beware!
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Not only that, but the EV tax credit is non-refundable meaning that someone who has less than $4K in Fed tax liability will not get the full $4K if claimed on the return. Transferring the credit to a dealer is a legal loophole as confirmed by the Congress. Taxpayer is not on the hook unless they understate their income below the 75/150K limit for either of two years. No partial pregnancy otherwise.
https://www.congress.gov/crs-product/IF12600
âSince the beginning of 2024, taxpayers have been allowed to transfer their credits to vehicle dealers. Transferred credits may exceed taxpayersâ income tax liabilities, effectively making transferred credits fully refundable. As a requirement for having received a transferred credit, dealers must compensate buyers with either a cash payment or a price reduction equal to the value of the credit. Taxpayers who transfer a credit but later exceed the MAGI limits must pay back the credit (to the IRS) when filing their taxesâ.
Extreme example would be a retiree or a young person with zero tax liability getting and keeping full $4K credit upon transfer to a dealer whereas they do not qualify for any if claimed on their tax return.
Update: Got the title for the mini SE this week, I checked all the documents and saw no time-of-sale report provided by the dealer. Contacted the salesman, yes, they didnât do it and just created one when I contact them and backdated it 3 days prior. This is why you insist them to apply the credit at pos. Never underestimate dealerâs incompetence.
Did they ever give you a copy of 15400? Itâd be funny if their own ignorance/laziness cost them $4K. Hope no problems for you but you may get a notice from the Service asking for a confirmation.
That!!! 101010
Yep, they gave it to me after I texted my salesman asking for that form. If I keep quiet, I may get a chance to use that credit one more time 