With the USA passing the new EV initiative - extending the new EV credits of $7500 and introducing $4000 tax credits for used EVs, I’m wondering about leased clarities. When I buy out my lease at the beginning of 2024, would it qualify for the used EV purchase? I’m assuming not, but one can hope, right? Thank you for your thoughts and replies.
I agree with Landshark, but it may be possible to still come out ahead by negotiating with a dealer in advance to turn it in and then have a spouse/relative/friend etc buy it. Not sure how that may be viewed if married filing jointly, consult your tax professional...
You could try the “relative” approach. Above is the wording on a Qualified Sale and there are some income limitations as well. Questions to ask: Would the dealer sell the car to the relative at a higher price than the lease buy out, knowing what you’re up to and that there is $4,000 on the table? Would the sale price be less than the maximum allowable figure of $25,000? If the relative later sold the car to you, would that constitute buying with the intention of selling? Yes, difficult to prove, but highly suspicious in appearance. What amount of sales tax, title fees and registration will be paid on the transaction(s)?
Thanks. I was pretty sure private sales were locked out of the $4K tax credit, but I fell victim to TLDR syndrome.
Anyone can buy a car and sell it to someone else. That’s always been an option and the new legislation hasn’t changed that. Whether or not you’ll make a buck on the deal is pure speculation. What has changed is that there is now a $4000 tax credit available on the qualified sale of a previously owned clean vehicle. Since a qualified sale is only available through a dealer, this puts a seller in a private transaction at a disadvantage. The private seller now has to compete with dealers who can provide a buyer the $4000 credit.
There is a price cap ($25k), but it will have a cascading effect on cars above this threshold too. It won't have an impact on high end EVs though I think.
