Electric car tax credit replaces quarterly estimated payments?

[dstonel]

In April I sent the first of what I anticipated would be 3 quarterly estimated tax payments to the I RS.  Subsequently we purchased an electrIc VW and the dealer submitted an application for the $7500 tax credit to the IRS.  Am I correct in assuming the the electric car tax credit (totaling 3X what the estimated payments would have been) would mean that I don't have to submit any morel estimated payments this year?

[KatherineS63]

Hello, 

Estimates are sent in so that you pay as you go through the year.  It is an 'estimate' because your taxable income can change each year.  

If you are expecting an EV credit of $7500, then your taxable income would be reduced by up to $7500.  

Remember this information:

In addition, the vehicle's manufacturer suggested retail price (MSRP) can't exceed:

• $80,000 for vans, sport utility vehicles and pickup trucks
• $55,000 for other vehicles

MSRP is the retail price of the automobile suggested by the manufacturer, including manufacturer installed options, accessories and trim but excluding destination fees. It isn't necessarily the price you pay.

I suggest looking at the IRS.GOV page for more information about the EV credit.  I would hate for you to not pay your estimates and then not qualify for the EV Credit.

Here is the link that you can copy and paste to see the IRS.Gov page.

https://www.irs.gov/credits-deductions/credits-for-new-clean-vehicles-purchased-in-2023-or-after

Enjoy your new EV.  I just bought a Tesla and LOVE IT!!