They're not quite George Jetson status, but electric vehicles (EVs) could have a positive impact on the future of the environment. 🛸 They also put any would-be gas money back in your pocket. ⛽💸 The government's new EV tax credit passed as part of the Inflation Reduction Act and things are in full swing.
But before you ditch your gas guzzler for a brand spankin' new plug-in, you should read the fine print. 👀 The credit everyone's raving about might only be worth it for certain Americans.
Here’s Five Fast Facts on the new EV tax credit :
- 🚗 Credit Check - According to the new law, if you purchase a new EV, you may qualify for a tax credit of up to $7,500. If you buy a used EV, the tax credit is up to $4,000 for used EVS, however...
- 🔋 Here's the Twist - ...there's a catch. The amount of the credit you receive depends on how much you owe Uncle Sam. For example, if you buy a new EV and owe the IRS $10,000, then you're entitled to the entire $7,500. If you only owe $3,000, then you're only entitled to that amount.
- 🛻 Ford Tough - If you're tired of smelling Elon's Musk, don't worry, you don't have to buy a Tesla. Eligible vehicles include makes and models from Ford, Chevy, and Jeep. Check out the full list here.
- 🏷️ Check the Price Tag - In addition to being on the special list, qualifying EVs must also have undergone final assembly in the United States. Vehicles must also not exceed a manufacturer suggested retail price (MSRP) of $80,000 for vans, SUVs and pickups and $55,000 for cars and other vehicles.
- 💰 Income-ing Info - Vehicles must be purchased on or after January 1, 2023. To be eligible for the credit, you must also have an adjusted gross income of $150,000 or less for single filers, $225,000 for heads of household, and $300,000 for joint or married filers.
🔥Bottom line: Is it worth running out to the car dealership tomorrow? Probably not. To be honest, it might not make good financial sense for your family at all. If you plan on taking advantage of the new EV tax credit, pay close attention to the qualifiers and ask a tax accountant if you're not sure. Dive deeper into the pros and cons of EVs here.
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