Will my SE still quality for tax credit

Are 24 from the QC lockdown?

 

Give it a rest. Please.

Setting aside the whole "this doesn't show what you're suggesting it shows because vehicles being picked up by owners also appear on this list" thing that has been discussed already, 25 cars across the whole country is not the groundswell of inventory you seem to think it is. You're searching for data to support a narrative.

"But it's almost triple what it used to be!!1!" ... Yeah, 3x a small number is still a small number. I'd have to drive 5+ hours through 4 states to reach the nearest dealership that appears on that list (passing up 13 others; 14 if we count Canada), only to have them say "sorry, no test drives; that's someone else's car". Actually, they wouldn't say that because it hasn't even arrived yet.

 

Why the histrionics? I'm just curious as to whether the passage of the IRA is impacting SE sales, as the poll here suggests it should. I assume others here might be as well, since, e.g., it might impact availability of the 2024 model. So far, the limited data available are consistent with that hypothesis, although they are obviously far from conclusive.

On a broader front, the IRA does appear that it might be having its intended effect, at least based on various announcements from, e.g., Toyota about plans to expand battery and EV manufacturing in the US. Of course, as the saying goes there's many a slip twixt the cup and the lip, so only time will really tell.

 

Re-reading the IRS guidance and noted the following:

Vehicles Purchased and Delivered between August 16, 2022 and December 31, 2022
If you purchase and take possession of a qualifying electric vehicle after August 16, 2022 and before January 1, 2023, aside from the final assembly requirement, the rules in effect before the enactment of the Inflation Reduction Act for the EV credit apply (including those involving the manufacturing caps on vehicles sold). If you entered into a written binding contract to purchase a new qualifying vehicle before August 16, 2022, see the rule above.

In essence, if an EV previously qualified for the credit but is not final assembled here or in a free trade agreement country, then the credit will still apply as long as you receive the vehicle before the end of the year. Good news for those with a Mini SE on order and already scheduled for production.

 

That’s exactly the opposite of what it says.

“Aside from the final assembly requirement” means it’s describing the effect of the new legislation apart from the final assembly requirement. You still have to factor that additional restriction in for the subset of EVs assembled outside the US.

 

Yeah, I guess you're right. Oh well.

 

The conclusion reached here and on every forum and publication I have come across is we just have to wait and see. Nobody knows anything for sure.

It was not well written.

 

We don’t know how the fine details of the final assembly provision will be applied (like what is and isn’t a “binding written contract”). But yes, we do know that Will’s particular reading of the IRS’s publication to suggest the final assembly provision will not be applied at all until 2023 is incorrect.

 

The main confusion stems from what constitutes as a binding contract made before August 16th (for example, is placing an order good enough). The take-away by Wills is literally wrong; there is no ambiguity - it is saying old rules apply in addition to the final assembly rule. To that effect, the IRS has already provided a list of cars purchased after August 16th that can still apply for the credit: https://afdc.energy.gov/laws/inflation-reduction-act

Mini SE is not on there.

 

Nothing like being literally wrong.

 

If you have a contract that can be defined as "binding" within the state you live, then you should be in good shape. The part that I still am not 100% certain is if you have a valid contract prior to August 16th, and your car is not delivered until sometime in 2023, will you still qualify for the credit? What tax year would it apply to?

If you read the IRS clarification, it gives you the impression that it doesn't matter when your vehicle is delivered. My Mini was originally scheduled for production the week of September 12th, but it was just pushed out to the week of October 16th. I am beginning to wonder if I will get it before the end of the year.

 

If you truly had a binding contract before 8/16, then it doesn't matter when the car arrives. It will be considered to be placed in service the day before the bill was signed, and you would claim the credit on your 2022 return (even if it means amending it).

 

You say that like it’s a bug, rather than a feature (as far as our legislators and regulators are concerned).

 

Sorry, I didn't mean to sound harsh or rude. I know many people are looking for some sort of confirmation that they're going to be in the clear with regards to the credit - myself included. Polyphonic made it sound like your interpretation is a possible one and it might mislead someone into purchasing an ineligible EV post Aug 16th.

 

Weren’t we discussing those with orders placed prior to the 16th?

An order placed on or after the 16th has no chance of receiving the credit, but for earlier orders there is some question as to what constitutes a binding contract - especially with regards to the state the vehicle is purchased in. As far as I am aware that is the main point of confusion in this bill & guidance.

 

No. If you read the comment made today that started this whole discussion - the second line, which is bolded, states:

Though maybe your comment was a continuation of comments made over 3 days ago? If that was the case, it was not clear, lol.

 

Probably easier just to read the IRA.

 

i still ask what is binding. If you can get your money back does that mean it isn't binding? If the dealer gives you a VIN, then tells you that they want a premium and you sue for specific performance, or they sell it out from under you and you sue for specific performance, did you have a binding contract? I bet there is more caselaw involving dealers doing the things that got them their "stellar" reputation than caselaw involving customers that walked away.

 

Supreme Court says Commissioner v. Gordon, 391 U.S. 83, 96 (1968)

US Tax Court says Niedermeyer v. Commissioner, 62 T.C. No. 34 (1974)

Barack Obama says Health Care and Education Reconciliation Act (2010)

IRS August 16th guidance says "In general, a written contract is binding if it is enforceable under State law and does not limit damages to a specified amount (for example, by use of a liquidated damages provision or the forfeiture of a deposit). While the enforceability of a contract under State law is a facts-and-circumstances determination to be made under relevant State law, if a customer has made a significant non-refundable deposit or down payment, it is an indication of a binding contract. For tax purposes in general, a contract provision that limits damages to an amount equal to at least 5 percent of the total contract price is not treated as limiting damages to a specified amount."

Take your pick.

 

(“Every time I try to get out…”)

Far as we know, at this time, there’s only one known example of what constitutes a binding contract, and that is the example of the non-refundable 5% deposit mentioned in the IRS advisory. That’s not to say that it’s the only example that passes muster here, but if you happen to have a 5% non-refundable deposit associated with your sales agreement, that alone should give you enough ammo to fight off an IRS audit should they question your attempt to claim the tax credit. After that, as you alluded to, what constitutes a binding contract is going to be broadly defined by the applicable caselaw and legal precedent regarding the elements of a binding contract in your state (e.g., mutual assent, valid offer and acceptance, adequate consideration, capacity, and legality.). At the end of the day, evaluating each of these legal elements, one-by-one, relative to your specific transaction and sales documentation would allow you to reach some conclusions about which contract elements you feel good about (e.g., capacity and legality), and conclusions about which contract elements you may not feel quite as good about (e.g., mutual assent, valid offer and acceptance, adequate consideration). And at that point, it’s just lawyers attempting to persuade the judge (or IRS auditor?) which is the controlling precedent with respect to any of the aforementioned elements of a contract. [IMHO, the “adequate consideration” element is the one that is hardest to argue if you have a fully refundable deposit and no other penalties associated with your sales agreement, but I ain’t your lawyer; I’m a rando on the internet.]

Either way, to the best of my recollection, in all of your posts in this thread, you have never once indicated which state/jurisdiction you live in. (And, to be clear, I’m not asking.). But, all told, if anyone were to attempt to answer your question without referring to the laws/regulations/caselaw in your state jurisdiction, that advice would probably be too general to rely on, even if given by a licensed attorney or tax professional. Either way, I re-offer my previous parting shot from earlier in this thread — rely on the legal advice of internet randos (no matter how reasonable or well-intentioned) at your own peril.