EV Tax Credits: New Changes Effective April 18, 2023
Important Changes to New Vehicle EV Tax Credits
The latest updates regarding EV tax credits have been released by the Internal Revenue Service and there have been significant changes that will impact your dealership.
Significant changes have been made to the new electric vehicle (EV) tax credits available under Section 30D of the Internal Revenue Code.
According to proposed guidance released by Internal Revenue Service, if possession of a new clean vehicle on or after April 18, 2023 is taken, it must meet critical mineral and battery component requirements to qualify for the credit. This applies even if the vehicle was purchased before April 18.
What does this mean for dealers?
- The new updates could mean that fewer EV make/models will be eligible for a Section 30D credit.
- For vehicles purchased on or after April 18, 2023, the credit amount will depend on the vehicle meeting the critical minerals requirement ($3,750) and/or the battery components requirement ($3,750). A vehicle meeting neither requirement will not be eligible for a credit, a vehicle meeting only one requirement may be eligible for a $3,750 credit, and a vehicle meeting both requirements may be eligible for the full $7,500 credit.
On April 18th the IRS will release an updated list of eligible vehicles for the tax credit.
Questions?
Dealership Advisors
Kristin specializes in tax services, particularly for pass-through entities and complex individual matters. Her clients span industries like dealerships, real estate, wholesaling, and professional services. Her approach goes beyond compliance, addressing clients’ pain points with a genuine care that ensures understanding, compliance, and strategic insights.