I ordered an EV (BMW i4) that was eligible for the existing tax credit in June of this year. I understand there is a transition clause in the Inflation Reduction Act that should allow me to take the credit since the car will be counted as "in service" on the day before the law was signed.
But the language specifically states that you must have a "written binding contract" to claim the credit. I am in Virginia, and signed a special order agreement with a non-refundable deposit, and my dealer also issued a signed buyers order with the VIN blank since the car is still scheduled for production. Is that sufficient? The IRS gives some guidance that in order for a contract to be binding, it has to not limit damages, and have penalties of at least 5% of the contract. In Virginia, the special order agreement has no limit of damages clause, but the deposit was less than the 5%.
Is there any updated guidance or interpretation on the transition clause from the IRS? How can I prove my contract is "binding" under my state law?
