EV Tax Credit Crater Sales Until Year End?

Your Tesla or GM EV will be $7,000 cheaper once the Inflation Reduction Act of 2022 is signed.

Of course GM (or Tesla) could just promise you that they’ll refund $7,000 of the purchase price when the new law is signed. I’d want that in writing.

Could new Federal EV tax credit crater EV sales until end of the year?


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Probably; more so for GM than Tesla - largely due to much higher price of their vehicles.


Credit applies for vehicles purchased beginning January 1, 2023. (Page 386, line 1).

Transition provision for EVs with written sales orders dated in 2022 prior to the date of President signing the bill but delivered in 2023 allows purchaser to claim the “old” credit in 2023. (Page 386, line 20).

Modified gross income limit of $150k for individuals, $225k for head of household, and $300k for joint returns. Definition of MAGI (page 375, line 22)

MSRP of vehicle must be $80k or less for SUVs, Vans and Trucks. $55k for all other vehicles. (Page 377, line 4)

As of June, Telsa has only has a single car model - the Base Model 3, with an MSRP below $55k and no SUV below $80k.


Unless Tesla drops the price of their vehicles, this is unlikely to result in big boost (or a glut in current) sales.