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To qualify for the federal tax credit, one must not exceed the following adjusted gross income limits:
$300,000 for married couples filing jointly
$225,000 for heads of households
$150,000 for all other filers
Federal EV Tax Credit is not refundable, which means one must have federal tax due to take advantage of it. If the tax due is less than the credit amount, one can only claim the credit up to the amount of the tax due.
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Here's how cheap you can get a new Model 3 RWD right now (including fed & local EV incentives):
• VT: $26,320
• MA: $26,830
• PA: $27,330
• MD: $27,330 - Delivered after July 1, 2023 https://marylandev.org/maryland-ev-tax-credit
• RI: $27,820
• DE: $27,820
• NY: $28,320
• CA: $28,330
• CO: $28,330
• CT: $29,030
• ME: $29,320
on top of above info federal, state and local incentive info that i posted , some employers are also providing ev incentive like exaple bank of america employees gets $5k incentive , in this case the best case scenario is like below
example scenario
• VT: $26,320 - $5000 bank of america employee ev incentive = $21,320
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CA CLEAN VEHICLE REBATE PROGRAM
$2K is available if your household makes <$200k.
There is an increased rebate of $7500 ($5500 on top of the $2k) available if you fall below income caps based on your household size.
Family of 4 max is $111k, Family of 6 is $149k.
This comes in the form of a check in 2-3 months. https://cleanvehiclereb
This is separate from the CARB Clean Vehicle Grants described below the dashes. It is possible to qualify for both, but the timing is different.
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And California residents that live in a disadvantage community (DAC) https://cleanvehiclegra
Disadvantaged communities are determined using CalEnviroScreen (https://oehha.ca.gov/calenviroscr...
here's the DAC map: https://oehha.ca.gov/calenviroscreen/sb535
And receive an Approval Letter through email.
You must receive an Approval Letter BEFORE you purchase a vehicle. We do not offer rebates and you cannot redeem a grant if you have purchased a vehicle before being approved.
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Top Comments
https://www.tesla.com/model3/design
Deal is even sweeter if you live in a state with additional credits:
VT: $26,320
MA: $26,830
PA: $27,330
RI: $27,820
DE: $27,820
NY: $28,320
CA: $28,330
CO: $28,330
CT: $29,030
ME: $29,320
Full tax credit details below, but the following income limits apply:
$300,000 for married couples filing jointly
$225,000 for heads of households
$150,000 for all other filers
https://www.irs.gov/credits-deduc...3-or-after
Withholding is totally irrelevant to qualifying for the credit.
If you're unclear on this go read a 1040.
The part where you compute tax liability is lines 16 through 24.
THAT is where the $7500 EV credit comes off.
Your withholdings aren't even looked at until after that on line 25+
This is also not correct.
The Child Tax Credit is worth a maximum of $2,000 per qualifying child. Up to $1,600 is refundable for the 2023 tax year.
Refundable credits are computed AFTER non-refundable ones-- so the CTC is only "worth" $400 off your tax burden for these purposes- the $1600 left is refundable.
Thus if you had say $7900 in tax burden and one CTC and one EV credit, your tax burden would go to $0 and you'd get a full refund of the $1600 refundable part of the CTC
Source:
https://www.nerdwallet.
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On the other hand, I would be thrilled to see the full tax credit available again on the non-Performance 3, but according to the IRS, the credit is still $3,750. See here [fueleconomy.gov]. This is current as of 6/1, so unless something changed since yesterday (and there is no news supporting this), it sounds like an error.
The overly simplified way to consider this is look at line 16 of the 1040 without any non-refundable credits considered yet... That is your initial tax burden.
You can reduce that amount, dollar for dollar, for all non-refundable credits available including the $7500 EV credit and the $400 non-refundable part of any CTC you qualify for.
If you get to 0 and still have non-refundable credits, you lose the overage but all refundable credits become the start of your refund amount.
If you still aren't at 0 you can now reduce that amount, dollar for dollar, for all refundable credits.
If you get to 0 and still have refundable credits you DO NOT lose that overage- it becomes the initial amount of your refund.
THEN, and ONLY THEN, would you look at your withholdings at all
If you were already at 0 with the above then you take your total withholdings and add 100% of it to your refund
OR
If you never reached 0 after all those credits, you reduce the remaining tax burden dollar for dollar until you reach 0 any remaining withholdings is your refund.
If you STILL don't hit 0 by the end of withholdings, that's your tax bill.
As a W2 employee with LLC receiving 1099, I would like to know if it make sense to make the move. The plan is to now instead write off more expense, report more 1099 income with a higher tax liability in which this tax credit should wipe off if not eliminated entirely.
With that I have a profitable business year on the LLC to then go out and qualify for more DTI for investment property, without having to pay so much tax on business side
You do have the option to pay $199 for one month to try it out though before you consider if it's worth the full price to you.
Yup- though I think they renamed the SR 3 to just RWD (since it's the only non-AWD version of the car)
You gotta pay the taxman one way or another. They just give it different names. How else are they supposed to keep the roads paved and the pay for the public services.
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https://smartasset.com/taxes/income-taxes
Type in your income, and select filing status (if youre not a single filer)
Your Income Taxes Breakdown
Tax Type Marginal Tax Rate Effective Tax Rate 2022 Taxes*
Federal 24.00% 16.87% $21,928 <<< THIS NUMBER IS HOW MUCH YOU PAY THE FEDERAL GOVERNMENT EVERY YEAR
Thats it. If its above $7,500 you get the full $7,500 tax credit, if its $7,000 then you only get $7,000. If its $5,800 you only get $5,800. So on so forth.
At the end of the year go to an accountant and pay them $300 to do your taxes, and they will probably save you other money, because if its too hard to figure this out then theres no doubt youre likely over paying the IRS year after year.
Go here:
https://www.tesla.com/inventory/n...&range=200
Change to your zip code to see what's available at what price and if it matches what you want options-wise.
If so you get that discount, plus the federal and state rebates (assuming you otherwise qualify for them with things like income limits, having sufficient tax burden, etc).
Cheapest right now is $37,830 (RWD Model 3, no options whatsoever)
With $9500 in tax credits you'd be looking at $28,330 plus tax/title/destination/etc
https://www.hrblock.com/
they will get it for you next year.
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https: //www.tesla.com/inventory/new/m3?arrangeby=plh&zip=>>>>ENTER YOUR ZIP HERE<<<<&range=200
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