It’s not much of a break for those mourning the impending loss of the federal EV tax credit break after Sept. 30, but the IRS now says you can qualify even if the dealer doesn’t have the vehicle of your choice in stock by then.
As part of the recent budget reconciliation bill, GOP members of Congress on a party-line vote decided to end the federal clean vehicle incentive program at the end of September.
The the rules said that those hoping to beat the clock to get the benefit of up-to-$7,500 on one of the few qualified new EVs would have to be in possession of the vehicle by Sept. 30.
But a new interpretation by the IRS says that possession of the vehicle isn’t required if there is a written binding purchase contract and a payment – a trade-in or down payment count – has been made by the 30th. The dealer also has to submit the necessary time-of-sale report by the deadline.
The new rule makes it a bit easier for EV shoppers who want an incentive-qualified model but can’t find it at a convenient dealership. As long as the dealer is willing to order the EV and to get the paperwork filed on time, signing a binding sales contract and making a down payment will meet the deadline, the IRS says.
The buyer, of course, must still meet all the eligibility requirements including modified adjusted gross income limitations, and the EV must meet the rules for battery content, place of assembly and pricing.
Click on the appropriate links here to find the new-buyer requirements and a list of qualified EVs.
Leased and Used, too
The new interpretation apparently also applies to used EVs and fuel cell vehicles if the vehicle and buyer meet all those requirements, which can be found here.
And, of course, for those who’d rather lease a new EV, a longstanding IRS ruling removes all the eligibility requirements – for vehicle and buyer – that purchasers have to meet. Leasing deals still have to be finalized by the end of the day on Sept. 30, however.
Carpool Lane Access Kaput
One benefit that does end promptly at midnight on Sept. 30 with no wiggle room is federal approval of solo occupancy HOV lane permits for EVs and fuel cell vehicles.
While permits are issued on a state-by-state basis, the ability of individual states to allow clean vehicles access to carpool lanes with only the drive on board has always been dependent on federal approval of same. And that approval dies on Sept. 30 along with other EV incentives at the federal level, all part of the Trump administration’s war on EVs.
As a result, hundreds of thousands EVs that have been been using carpool lanes without actually carpooling will no longer be allowed to do so. In California, the state with the largest EV population, that’s expected to kick around half a million drivers back into the regular flow of traffic each day.
While it has been a great selling point for EVs, carpool lane access always seemed a bit iffy as those lanes are intended to help reduce congestion, while EVs are intended to help improve air quality. there’s a bit of overlap, in that congestion creates more air pollution than does free-flowing traffic, but adding all those one-occupant EVs to the carpool lanes – at least in California – has served over time to make those lanes as congested as the rest of the freeway in many areas.