The Electric Vehicle Tax Credit Turbo Tax Incorrect

[samg23]

The electric car is rejecting my Tesla Mode 3 as not available here the form accepts it.

[Vanessa A]

Tesla does not qualify for a tax credit for 2022.  Starting with January 1, 2023, some Tesla's purchased after that date will qualify again for the credit, but if it was purchased in 2022, it will not qualify. 

[samg23]

Your reply is wrong. I have spoken to the IRS. Your revisions are based on the Draft issued in January and your forms are wrong. Changes were made to allow tax credits for Tesla 3 after 8/16 2022-2023.  I contacted Tesla and that is their understanding. The inflation reduction act made this available. The regulations are still under draft review it would be wrong if you purchased a 2022 in 2023 and still being discussed by the IRS. Please keep me advised.

Sam

[KrisD15]

After 8/16/22 regulations were altered to require final assembly be in North America which eliminated some vehicles from being eligible, but Tesla had already been phased out because of the limit on sales after 2019. 

Regulations have been finalized. 

Regulations for 2023 changed and Tesla is again eligible for 2023 going forward. 

Your 2022 Tesla may be eligible for a credit for a person that purchases it from you if certain conditions are met. 

Here is a link to updated (January 2023) Instructions for Form 8936.

As you can see, under Line 4b, Tesla gets 0% if purchased before 2023.  

[FengW]

This is quote from IRS Line 4B:

"Tesla.

 Enter the following percentage if the vehicle was manufactured by Tesla.

• 0% if you purchased it before 2023.

• 100% if you purchased it after 2022."

If we purchased after 2022 but before 2023,  should it be 0% or100%?

[AnnetteB6]

If you purchased it after 2022, then that means it was during 2023.  Therefore, 100%.

If you purchased it before 2023, then that means it was during 2022.  Therefore, 0%.

Teslas will qualify if purchased in 2023, not 2022.

@FengW 

[Jackyen]

I got the same information too, but when filing with turbo tax, the $7500 EV credit is not available for the Telsa Model 3 that I bought on December 2022. 

[KrisD15]

Correct, because it was purchased in 2022. 

"0% if you purchased it before 2023."

December 2022 is before 2023.

@Jackyen 

[slowdive23]

The latest official announcement on the IRS website (updated July 13, 2023) states that “Vehicles purchase between August 17 and December 31, 2022, must also have undergone final assembly in North America to qualify for the credit.”

on that same page, and the index for Tesla, Inc., it states, “ The credit for qualified plug-in electric drive motor vehicle sold before 2023 is subject to a phase out once the vehicle manufacturer or, for a foreign manufacturer, it’s US distributor, sells 200,000 of these vehicles to retailer for use in the United States after 2009. The phase that begins in the second quarter after the quarter in which the 200,000th vehicle was sold. Then the phase out allows 50% of the full credit for 2/4, 25% of the full credit for two additional quarters, and no credit thereafter.”

I have contacted the IRS and they have confirmed that this information is up to date and accurate. I would avoid using the tax software (like I will) and pay a professional to see about getting your federal rebate/tax credit for your EV purchase in 2022.