- $580 Million paid for EV tax credits in the U.S. this year.
- IRS receives 100,000 Point-of-Sale EV reports since January 1st.
- $7,500 tax credit for new electric car buyers in the U.S. gains significant popularity.
The IRS Gets 100,000 Point-of-Sale EV Reports Since January 1st
The $7,500 tax credit for buyers of new electric cars in the United States appears to be significantly popular among customers.
The U.S. Treasury reports that this year, over $580 million in advance point-of-sale EV tax credit payments have been reimbursed to car dealers, with approximately 100,000 time-of-sale EV reports submitted to the IRS since January 1st.
Until the end of last year, individuals eligible for a new EV tax credit of up to $7,500 or the $4,000 used EV credit could only access these benefits when they filed their tax returns the following year. However, as of 2024, the option for buyers to transfer the credits to a car dealer at the time of sale has gained traction. This approach effectively reduces the purchase price of the car and removes the burden of worrying about filing tax returns in the subsequent year.
Though, customers must first meet specific income limits to qualify for the tax credit at the time of purchasing the EV. Failure to meet these requirements may result in the need to repay the government when filing taxes, so there remains a degree of concern. However, with adjusted gross income limits set at $300,000 for married couples and $150,000 for individuals for new EVs, many purchasers can still benefit from this incentive.
Treasury spokesperson, Haris Talwar, said;
“Demand is high four months into implementation of this new provision.”
Introduced in 2022 as part of the Inflation Reduction Act, the EV tax credits were initially applicable to eligible vehicles assembled in North America. However, at the start of 2024, the rules underwent a change, excluding battery-powered vehicles containing battery components sourced from “foreign entities of concern” (FEOC) such as China, Iran, and Russia.
When the changes took effect, 24 models lost eligibility for the $7,500 tax credit, leaving just 19 EVs on the list. But now, cars like the Volkswagen ID.4, Nissan Leaf, Chevrolet Blazer EV, and Cadillac Lyriq have made a comeback.
