04.30.2023
Last year after pressure from Korean and other EV/Hybrid foreign legacy, and US legacy too, the government offered a magic loophole to bypass all restrictions on EV Tax credit : Leasing.
As some know, the retail tax credit offers $3750 or $7500 off an EV or Plug in Hybrid.
However, this tax credit is extremely limited by manufacturer limits on The car, depending on where it was manufactured where the battery is assembled and the source of the battery materials and the retail cost.
The Tax credit also limits the recipient, with Max income limits and minimum taxes paid in order to receive the credit.
Obviously, this is a good thing for the consumer, but, I am not sure it serves the original purpose of the bill which was to force manufactures to build factories, make the cars in the US, make the batteries and source materials in North America.
In other words,
All European, Korean, Japanese, Plugin Hybrid and EV's are now qualified to enjoy the full $7500 rebate.
All Incentives are available now, not in 1 year when tax return filed.
The rebate is not associated with minimum tax paid at all.
No Income limits.
No maximum per retail price.
The only question yet is wether the company will actually pass entire incentive as a direct discount to lease payments or will they keep some or all of it.
It is really difficult to determine if the company is applying the full incentive.
This is expected from the companies that for the last 2 years did everything (or nothing to stop dealers) from slapping extra hidden costs on top of the MSRP, as Dealer fees and adjusments.
This loophole is achieved by Government paying to the manufacturer through the Commercial incentives part of the IRA.
This already doubled Lease transactions from around 20% and expected to triple this year.
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