On the EV pre negotiated deals and in the broker advertised prices, do these reflect the federal tax credits being transferred to them?
If not, is that an option for a lower vehicle price and thus lower payment?
Thanks!
There is no federal ev tax credit that is transferable on a lease.
2 Likes
Yes there is. Look it up.
Seems some companies are reflecting this delta in a higher residual.
https://www.edmunds.com/fuel-economy/the-ins-and-outs-of-electric-vehicle-tax-credits.html
No, there isnt. A transferable tax credit is a very specific thing that pertains only to purchases.
Section 30D of the IRA has a provision that allows you to transfer your tax credit to the dealer on a purchase as an upfront rebate rather than waiting for you to file your taxes.
Leases fall under section 45W of the IRA, where the bank receives a tax credit when they purchase the vehicle for the commercial purpose of leasing. They then may choose, if they desire, to offer some/all of that amount in incentives (or as RV support, etc.)
So when you lease, the vehicle gets the incentives that it gets. There is no additional tax credit that you may or may not qualify that you have a capability of transfering to the dealer for an additional cap cost reduction.
4 Likes
What you’re reading there is an oversimplification to try to explain things to the general public, so rather than argue semantics about tax law, I’m going to more directly answer the question you’re trying to ask here and in the multiple broker threads you’ve asked in.
The incentives being offered by the banks are included in all the pricing you’re seeing. There is nothing extra you can add on.
10 Likes
4 Likes
Very simple answer, thank you.
It seems most of these seemingly low cost EV leases are reflecting this discount albeit not explicitly. The question is how much said manufacturer is passing on the savings, according to the second article I posted some more than others.
Simple answer to a simple question.
Don’t know why you over complicated it.
You must be the type that enjoys the smells of his own farts.
I can tell from 100 miles away thru the internet.
Because the “transferrable tax credit” as mentioned is a real option on a purchase. On a purchase, you receive a tax credit, and starting in 2024, have the option to transfer that tax credit to the dealer as an upfront cost reduction. It is something that not everyone qualifies for, so it would be something that a dealer may or may not include in pricing.
On a lease, this doesnt exist. There is no tax credit for you to transfer or something that could be optionally applied. What you see is what you get. There is no situation where it may or may not be included depending on the dealer’s mood.
There is a major difference between tax credits one may get on a purchase and incentives on a lease that gets lost on many and results in confusion, like thinking there may be an ev credit that could be added to a lease.
As for the rest of your post, take the attitude elsewhere.
7 Likes
You guys are both saying the same thing, so we’re just arguing semantics here!
@NedDanders the numbers you see in lease deals listed here will ALWAYS include the federal tax credit. That’s what makes EVs leases so attractive right now compared to many ICE vehicles.
As I’m sure you know, it is a loophole which allows high income earners and foreign OEMs to take advantage of the IRA tax credit.
Some manufacturers chose not to pass on the tax credit. It’s completely up to each manufacturer to decide. For most of 2023 Tesla did not pass it on at all. And BMW would only pass on $3,750 for their popular M models. But now in 2024 I see that most OEMs are passing on all the entire $7,500 savings to the consumer in the form of a reduced cap cost and lower payments for our leases!
1 Like
That’s the thing… we’re not. There is more nuance to this. When purchasing an EV, there is a situation where there’s an additional tax credit that can optionally be elected to be transferred to the dealer. Quite a few, but not all, dealers advertise with this amount included in their listed prices. Because this is a credit that has specific qualification requirements and is not required to be transferred to the dealer, it’s a very critical question to ask when talking pricing. You have to know if the pricing includes a transferable tax credit or not.
On a lease, none of that exists. The incentives are what they are. There is no tax credit being transferred over. There’s no option of choosing if it’s applied, etc. There is no situation where there would be a price advertised where the incentives could be added.
It’s a very common misunderstanding that leases qualify for the ev tax credit, so people think all the time that there’s extra money waiting for them. Because the transference of the tax credit on purchase started at the beginning of this year, there’s been lots of discussion out there about how you can suddenly start transferring the tax credit as extra money down on an ev now. I’ve lost track of how many people I’ve seen ask here and in other groups in the past few months while doing their taxes how they claim the tax credit for an ev they leased in 2023, despite getting money upfront on the lease as a cap cost reduction.
3 Likes
Doubling down on being wrong? Nah, couldn’t be another Eric or DailyDriven. @littleviolette please check
1 Like
Not to be pedantic, but if someone wanted to buy a $100,000 car and the dealer offered a $7,500 lease cap reduction, you could lease the car, and then turn around the next day and buy out the lease, and now you’ve purchased the car for $92,500. That’s a $7,500 savings to the end consumer, right?
The only distinction is whether the “end consumer” get the the tax credit on their personal taxes, or the “dealer/manufacturer” gets the tax credit on their business taxes. But the end result of savings to the consumer is the same. <<<<-- This is all we care about here at LH! 
1 Like
You should be when discussing subjects like this.
2 Likes
No, it’s not. If one is trying to stack the ev credit on top of a lease, theyd be trying to double count any gov money coming.
Imagine thinking one could add an extra $7,500 in rebates to a pre-negotiated deal by saying a few magic words.
1 Like
There are many folks doing this, especially on Toyota/Lexus plug in hybrids. The savings end up being less than the full $7,500, due to the lease acquisition fee.
1 Like
Yes that’s all I was trying to get some clarification on
The sass I’ve received is so unnecessary and extra—I can tell many here are still single and childless and can’t quite figure out why
I was simply trying to discern what manufacturers are giving the maximum benefit so as to get the most for my money
No one thought this numb nuts
Tho several seemed to presume this