"Placed in service" vs. date of acquisition for a vehicle--Form 8936

[andrewkc69]

Hello,

I can't seem to find anywhere on this support site to post a question or topic or anything. It seems to be impossible to get help. So, I am replying to this topic. I have a 2022 Chevrolet Bolt EUV, which I purchased in November of 2022. I tried to enter the information for the tax deduction into TurboTax and it would not give me the deduction. The IRS says it qualifies for the deduction, so can anyone tell me why TurboTax won't let me deduct it??

[harlanpepper]

Tesla and GM had both hit the 200,000 unit sales mark which disqualified them from tax credits under the former policy.  The 2022 IRA (while adding manufacturing location and battery sourcing requirements, adding complications for foreign companies), loosened things up for US car companies.  As part of the IRA, the 200,000 unit sales cap was eliminated, meaning Tesla and GM buyers could once again take advantage of the tax benefits.  Unfortunately for you, the cap removal did not go in to effect until January 1, 2023.  Chevy Bolts purchased in 2022 do not qualify.  I don't know why the IRS site is inaccurate.  It may only be reporting on the sourcing/manufacturing location specs of a given VIN (i.e., that vehicle qualifies based on the new rules in 2023).  It may not factor in acquisition date.  

[KrisD15]

There have been changes regarding credits for electric cars and the Chevrolet Bolt will be eligible for a credit in Tax Year 2023, but in 2022 they had hit the maximum number of that vehicle which was eligible for the credit, so the credit is not available for Tax Year 2022.

That restriction is being eliminated for Tax Year 2023 but not for 2022.

Here is the IRS link for cars purchased in 2022

"To qualify, a vehicle must:

• Have an external charging source
• Have a gross vehicle weight rating of less than 14,000 pounds
• Be made by a manufacturer that hasn't sold more than 200,000 EVs in the U.S.

You can find your vehicle's weight on the vehicle's window sticker."

Something to keep in mind if you decide to sell or trade-in the 2022 Bolt, there may be a credit that the new owner can apply for. 

Used clean car credit

@andrewkc69

[EchoRomeo]

Hello,

I just came across this thread and, given the ambiguity around "placed in service," was idly wondering if my 2022 Bolt EUV, which I purchased in Oct of last year might still somehow qualify for the tax credit that kicked in for GM on Jan 1. My reasoning is that if I financed the car last year and then am paying it off this year, and in doing so getting the actual title in 2023, could "date of acquisition" actually be considered 2023 for tax credit purposes?

I would have waited until 2023 to get the car but in Oct last year everyone was saying GM still wouldn't qualify for the full $7500 after Jan 1 b/c of the battery sourcing requirement. Really wish I hadn't listened to the news media and had just waited to see how Biden actually implemented the IRA.

Thanks!

Eric

[aguilarpierre]

I have a question about this. If I purchased a used vehicle that qualifies for tax credit would the in service date be date I purchased? Or is it when original owner purchased?

[JohnW152]

The placed-in-service date would be the date that you placed the vehicle into service, which would be on or after your purchase date. 

Although the IRS hasn't released TY 2023 instructions for Form 8936, Clean Vehicle Credits reflecting this new part of the credit, this interpretation would be consistent with existing tax policy.  Last year's Instructions for Form 8936 (01/2023) indicate simply that a taxpayer should "[u]se Form 8936 to figure your credit for qualified plug-in electric drive motor vehicles you placed in service during your tax year." [Emphasis mine.]

See the IRS' Used Clean Vehicle Credit for all qualification requirements.

@aguilarpierre