# Federal Tax Credit



## Soto (Oct 18, 2016)

I'm evaluating the possibility of getting Model S. What's our time frame for the $7500 federal tax credit? Is it still in full effect or are we in the phase out period?
I'm confused if the program adds S and X together for this credit or is it S separate and X separate for the 200,000 phase out trigger.
Secondly, does anyone have a projection of when the phase out might begin if it didn't already?

An FYI, NJ currently offers sales tax exempt on EV's. 

This is not about the Model 3. I want to concentrate on Model S in particular.

Thanks


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## MelindaV (Apr 2, 2016)

Tesla just passed their sale of 100k US cars, so you have about a year before the credit begins to be phased out. It doesn't matter which vehicle model, it's by manufacturer.

ETA: that is assuming the new congress doesn't revoke the existing law


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## Soto (Oct 18, 2016)

Oh, 100k is the trigger? So that means Model 3 is also in jeopardy. Then they'd better pump out as many cars as they can this year, and all models! Yikes!


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## MelindaV (Apr 2, 2016)

no, 200k is the start of the closeout of the credit. They CURRENTLY just sold their 100k-th


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## Soto (Oct 18, 2016)

OMG! I think NJ no longer gives sales tax exemption on Teslas! Oh noooooo! Tesla's website shows as exempt, but on the NJ Division of taxation website I no longer see Tesla listed.


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## Soto (Oct 18, 2016)

I got confirmation from Tesla that NJ does not charge for sales tax. I'm not sure why the NJ Division of Tax website took off Tesla from the pdf and lists that cars under $35.000.00 are exempt. Perhaps it's a new law that hasn't taken effect yet. But at least it's good to see that the sales tax is not charged. I'm not sure what will happen by the end of the year if we can be lucky enough to take the Federal tax credit as well as save on sales tax. Fingers crossed.


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## patrick0101 (Apr 4, 2016)

Tesla has shipped more than 100,000 cars to the US. This puts them over half way to the sales volume that will trigger the start of the $7500 Federal incentive phase out. Will the Model 3 get here in time for buyers to qualify for the incentive?

http://www.carswithcords.net/2017/01/when-will-tesla-hit-200000-us-sales.html


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## garsh (Apr 4, 2016)

Looks like a pretty good article.

TLDR: Deliveries before Sept 30 2018 will probably all get full incentive.

Aside: I _SO_ want to get a vinyl grill like in your avatar.


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## BigBri (Jul 16, 2016)

I'd expect to see them game the system a bit and sit and plan to not cross 200k but sit at 199 to give another quarter before the phaseout starts.


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## JoelH (Apr 4, 2016)

This Saturday (Mar 18), I got the following from my local Tesla store (I've been considering pulling the trigger on a Model S instead of waiting on the M3). Bold emphasis mine.

_Hi Joel,

Are you still interested in the S 60 Trim?_​
_Tesla will be discontinuing the S 60 & 60D effective April 17th, and our *$7,500 Federal Tax Credit is slated to expire in the next 2-3 months*.

How shall I help you moving forward?
_​This contradicts what I've heard about how long the credit will be in effect. Just salesperson BS?


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## JoelH (Apr 4, 2016)

JoelH said:


> This Saturday (Mar 18), I got the following from my local Tesla store (I've been considering pulling the trigger on a Model S instead of waiting on the M3). Bold emphasis mine.
> 
> _Hi Joel,
> 
> ...


I responded to the email, pointing out (based on reports of how many cars they've sold) that it should be a few quarters until they got to 200,000. This was in the reply:

_While I can't speculate on any 3rd party analysis, what I can tell you is that I have heard we are less than a quarter of sales away from hitting the cap._ ​Hmmmm....


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## KennethK (Oct 13, 2016)

JoelH said:


> I responded to the email, pointing out (based on reports of how many cars they've sold) that it should be a few quarters until they got to 200,000. This was in the reply:
> 
> _While I can't speculate on any 3rd party analysis, what I can tell you is that I have heard we are less than a quarter of sales away from hitting the cap._​Hmmmm....


This is a quote from today. https://electrek.co/2017/03/20/tesla-global-fleet-reaches-4-billion-electric-miles-ahead-model-3/

"Deliveries have been somewhat down and now flat on a quarter-to-quarter basis over the past 2 and the current quarter. Therefore, the fleet is not accelerating as quickly as it used to, but the company is expected to have passed the 200,000 vehicles mark between the Model S and X this quarter."

The 200,000 for the $7500 tax credit refers only to vehicles sold in the US. Tesla is approaching the 200,000th vehicle sold worldwide.


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## MelindaV (Apr 2, 2016)

JoelH said:


> I responded to the email, pointing out (based on reports of how many cars they've sold) that it should be a few quarters until they got to 200,000. This was in the reply:
> 
> _While I can't speculate on any 3rd party analysis, what I can tell you is that I have heard we are less than a quarter of sales away from hitting the cap._​Hmmmm....


He is either full of crap or misunderstands what information he is getting.


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## TrevP (Oct 20, 2015)

Man, there is so much confusion about this. Tesla is NOT close to the 200K cap of cars sold in the US. They're about to exceed 200K cars PRODUCED world-wide.

The biggest problem here is the severe lack of communications from Tesla, even internally I'm told from a friend who works there. The salespeople only have enough information to sell the cars and not much more.


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## InElonWeTrust (Jan 4, 2017)

That sounds like a very misinformed employee or a typical retail salesman creating urgency to get you to act. I cannot imagine any 3rd party would be that far off, particularly since Tesla announces their sold units, at the end of each quarter. Plus if they were that close to the limit, don't you think we'd hear from Elon, not a lonely salesman at the local Tesla store? I'd forward to Tesla and let them review his/her tactics being it is very contrary to the Tesla business model. Or at the very least provide better training to their staff, as TrevP pointed out.


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## DaveIrina (Dec 24, 2016)

I'm told by a Tesla dealer that the $7500 federal tax credit will be disappearing around late summer (2017) when Tesla delivers it's 200,000th car, do you believe that is true?

Also, that dealer told me the entire production run for model 3 scheduled for 2018 is booked up with orders from current Tesla owners, so if that is true I will not be getting a car until some time in 2019....., is there any truth in this? 

Maybe it makes sense to do what the dealer suggested and buy one of the model S they have been using as demo cards, he said they are discounting them a fair amount ($7800 in the case of one car we were looking at), and those model S's retain free supercharging and the $7500 tax credit (assuming I buy it this summer). They also agreed to shut off autopilot in the configuration and deduct it from the price to get the price down for me

So now I"m confused, wait for the model 3 until who knows when......, or get the Model S (which will not get me the performance model and 338 mile range I was hoping for in the model 3.

Could there be a discount if one orders a completely loaded model 3 (all options)?

Your thoughts please?


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## MarkTX (Mar 14, 2017)

Not sure if this helps, but here is the official phase out

https://www.irs.gov/businesses/plug-in-electric-vehicle-credit-irc-30-and-irc-30d

Basically 50% for two quarters after 200k sold in US, and then 25% for next two quarters, and then nothing federally.

Now if Tesla would do something cute, like create a new company, I am sure the lawyers could do a restart (just my ignorant opinion)


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## MelindaV (Apr 2, 2016)

DaveIrina said:


> I'm told by a Tesla dealer that the $7500 federal tax credit will be disappearing around late summer (2017) when Tesla delivers it's 200,000th car, do you believe that is true?
> 
> Also, that dealer told me the entire production run for model 3 scheduled for 2018 is booked up with orders from current Tesla owners, so if that is true I will not be getting a car until some time in 2019....., is there any truth in this?
> 
> ...


Welcome - (and they are not dealers, just Tesla employees)
all Federal tax credit estimates point to the 200,000 Tesla sold in the UNITED STATES to be around Q4 2017 or Q1 2018 +/-. Then, the credit remains available for the rest of that calendar quarter and the following quarter... then reduced to ½ for 2 quarters, than to a ¼ for 2 quarters. SO... there will be some form of the federal credit likely available thru 2018, with the full $7500 likely thru 2018 Q1 or Q2. Tesla is however approaching their 200,000th car sold worldwide, which does not matter to the credit.
As for the backlog, yeah, I would agree the current reservations will take thru most of 2018 to fill (not current owners - those are just a fraction of the reservations). A newly placed reservation likely would be looking at the end of 2018 at the soonest.
Be careful on an existing model. Are those 'Demo' cars sold as NEW? if it's considered a CPO you would not qualify for the credit, and if not a CPO, my understanding is any 'new' Tesla delivered after March 31st would not get the unlimited Supercharging (unlimited SCing needed to be ordered prior to 12/31/16 and take delivery by 3/31/17).
Personally, I'd rather wait and get the car I want, paying the extra for the options I want instead of paying the extra for a larger car without options, but YMMV.


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## MelindaV (Apr 2, 2016)

MarkTX said:


> Basically 50% for two quarters after 200k sold in US, and then 25% for next two quarters, and then nothing federally.


slight correction - it remains at 100% for the remainder of the quarter the 200k is sold plus the next quarter (possibly up to 6 months if the 200Kth is sold on the first of a quarter) THEN it begins being reduced.


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## MarkTX (Mar 14, 2017)

better, thanks


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## Mark C (Aug 26, 2016)

Maybe he meant late summer 2018? That would be a close estimate of American sales followed by ~ two quarters {depending on the date # 200k is sold} of full credit before dropping to 50%. Either way, Trevor has an excellent video on this topic and a similar video for Canadians.


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## DaveIrina (Dec 24, 2016)

Thanks MelindaV and others, great input! And thanks for the warm reception to this forum.

Hmmmmm, it they hit 200k in the last quarter of 2017 then......, we would have until March 2018 to ....... order the model 3 and get the credit? Or is it ..... take delivery of the model 3 to get the credit?

Do we have access to data that shows how many of the reservations are Tesla owners? and how many are USA based?

When I consider all we've discussed here, it looks like it could be a close call for getting the full credit, but appears pretty certain that we will get some amount of credit.

I share the same thoughts as MelindaV, I really would prefer to get the car I want and pay for the options I want. When I was looking at the numbers and considering the demo model Ss I was getting a bad feeling about the options on those cars (mainly range, I believe I need the highest possible range (> 300 miles) as I'm out in the sticks in Iowa, any trip will start off with a long drive to the first supercharger). To go the model S route would cost me a lot more than $7500.......

Appreciate the help.


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## MelindaV (Apr 2, 2016)

DaveIrina said:


> .... order the model 3 and get the credit? Or is it ..... take delivery of the model 3 to get the credit?


The credit is based on when you take delivery.


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## tivoboy (Mar 24, 2017)

Hate to be a downer but I've said this to folks since before the first order date. The majority of current orders are most likely NOT going to be getting a 7500$ tax credit - unless the laws are changed - which there seems to be little chance of. So, the value proposition for buying is going to be solidly reduced - as are the sales projections and the alternate manufacturers have some real opportunities here. That said, anyone in the early order queue (hopefully I am ordered at about 19:00.30 pst) will have a vehicle that has a much higher market value going forward and can probably drive the car for FREE for the first 12 months at least if not make money on it within the first 12 months of at least 10-15% on a resale.. so, early buyers, pick your options WISELY and don't think of it as overpaying.


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## Bruce D (Apr 30, 2016)

That's not a bad idea! For those 31 March-ers who wanted AWD and performance, maybe get what we can with ($7500) + state rebate ($5,000), turn around and sell at a profit for somewhere in the middle, then take the proceeds (+ a little more out of pocket) and by a CPO MS with AWD and/or performance? Hmmm... am I missing something?


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## MelindaV (Apr 2, 2016)

Bruce D said:


> That's not a bad idea! For those 31 March-ers who wanted AWD and performance, maybe get what we can with ($7500) + state rebate ($5,000), turn around and sell at a profit for somewhere in the middle, then take the proceeds (+ a little more out of pocket) and by a CPO MS with AWD and/or performance? Hmmm... am I missing something?


just that the federal and most of the state credits are for cars purchased to be used by the person claiming the credit, but to be claimed then turn around and sell it.


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## tivoboy (Mar 24, 2017)

yeah, there is no problem actually buying the car, getting the credits and selling the car later.. one DOES have to pay the sales tax of course, but selling to a new buyer is not transferring in any way and not restricted by Tesla (or feds) at all like the pre-order is. 5000$ state tax credit would be really nice..I hear there are some places that are actually 10000$ in addition to the 7500$ federal. would be nice.


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## MelindaV (Apr 2, 2016)

You are incorrect. California specifically requires the car is registered to you for 30 months for the credit. Some have speculated CA can come after you for a prorated amount of the credit if the car is sold. The federal credit states the car is to be purchased not to be resold to qualify for the credit. It doe st give a timeline, but may expect if audited, they may want to see proof of ownership.


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## sam s (Oct 18, 2016)

why is everyone so worried about the federal tax credit??? unless you have a tax liability above 7500 come tax season it doesnt really matter. for example...

if you get a federal return of any amount you will not get $7500 more dollars from the govt.
if you owe the federal govt say $2,000, and you got the 7500 credit you will owe the govt $0( you will not get 4500 back)
if you owe the federal govt $8,000 you will now only owe them $500

I am going out on a limb here and betting most people who pre ordered the model 3 don't have a tax liability of more than 7500. I am pretty sure my understanding of the tax credit is correct, but if not please someone correct me.

So in summary, whether you get the 7500 or the 3750 credit amount it more than likely wont make a difference.


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## Dan Detweiler (Apr 8, 2016)

sam s said:


> why is everyone so worried about the federal tax credit??? unless you have a tax liability above 7500 come tax season it doesnt really matter. for example...
> 
> if you get a federal return of any amount you will not get $7500 more dollars from the govt.
> if you owe the federal govt say $2,000, and you got the 7500 credit you will owe the govt $0( you will not get 4500 back)
> ...


Yup, you are correct. I think many folks are thinking of the credit as a refund. It isn't an added $7500 to whatever your refund may be without it.

Dan


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## garsh (Apr 4, 2016)

sam s said:


> why is everyone so worried about the federal tax credit??? unless you have a tax liability above 7500 come tax season it doesnt really matter.


For those who do not normally have enough tax liability, this represents a great opportunity. You can make some financial moves that result in increasing your tax liability, then cancel out that increased liability with the credit!

The main one that comes to mind: If you have money in a 401k or IRA, you can convert some of it to a Roth 401k/IRA. With a normal 401k/IRA, the money goes in tax-free, and you pay taxes when you take it out (when ideally you'll be in a lower tax bracket). With a Roth 401k/IRA, you pay tax on the money before you put it in, then you take it out tax-free. If you convert to a Roth, you pay the taxes on the money during the conversion. So the idea here would be to put the money in tax-free, convert to a Roth and cancel out the taxes owed with your credit, then when you retire you get to take out that money tax-free! No taxes owed or paid on that money!

If you're in a position where you don't think you have enough liability to cover the credit, I think it's worth your while to look into these sorts of options.


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## MelindaV (Apr 2, 2016)

I would hope that the majority that reserved WOULD be in a position to have a $7500 tax liability. Otherwise unless they have the majority of the car cost sitting in a savings account, it likely would be way over extending their budget. But that's the typical American way, right? Have every last paycheck dollar go toward debt bills... 
omg I've turned into my father lecturing about debt....


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## Badback (Apr 7, 2016)

DaveIrina said:


> I'm told by a Tesla dealer that the $7500 federal tax credit will be disappearing around late summer (2017) when Tesla delivers it's 200,000th car, do you believe that is true?
> 
> Also, that dealer told me the entire production run for model 3 scheduled for 2018 is booked up with orders from current Tesla owners, so if that is true I will not be getting a car until some time in 2019....., is there any truth in this?
> 
> ...


Tesla does not have DEALERS. All Tesla stores are company owned.

No, the FTC is not disappearing in 2017.

Tesla has ~400k RESERVATIONS for Model 3s. We do not know at this point how long it will take Tesla to complete deliveries on that quantity if they all turn into ORDERS.

According to Elon, the Model 3 will never have the range that you suggest.

Tesla does not discount new cars. Some FTC may apply, but you are late to the party and that boat may have already sailed. (Do you like my mixed metaphor?)


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## Badback (Apr 7, 2016)

MelindaV said:


> I would hope that the majority that reserved WOULD be in a position to have a $7500 tax liability. Otherwise unless they have the majority of the car cost sitting in a savings account, it likely would be way over extending their budget. But that's the typical American way, right? Have every last paycheck dollar go toward debt bills...
> omg I've turned into my father lecturing about debt....


I have a unique situation. I am retired and have very little tax liability, surely not enough for the FTC. But, my OTHER is still working and she pays about $40k/year in taxes. So, we will simply title the Model 3 in both names and she will take the credit. And, yes, I do have the full purchase price sitting in my bank account. This will continue to grow while I am waiting to order my Model 3 so I can buy more options. YEAH!


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## Dave Davenport (Jul 2, 2016)

sam s said:


> why is everyone so worried about the federal tax credit??? unless you have a tax liability above 7500 come tax season it doesnt really matter. for example...
> 
> if you get a federal return of any amount you will not get $7500 more dollars from the govt.
> if you owe the federal govt say $2,000, and you got the 7500 credit you will owe the govt $0( you will not get 4500 back)
> ...


I think someone figured out that you have to have a regular income of around $65-75k per year to have a $7500+ Federal tax bill. I would argue that most people who have pre-ordered, are at or above this level. Some people are retired and have different circumstances. Some people have just purchased a home and their interest deduction lowers their taxable income a bunch. These are exceptions.

The issue I have with your wording is you state if you get a return of any amount, you will not get $7500 more, which, to my knowledge is not how it works. I will get a return because I did not set my exemptions high enough so I paid too much in tax throughout the year, but I will also get $7500 more because I will have a federal tax liability of greater than $7500.


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## Mark Eldridge (Apr 27, 2016)

Dan Detweiler said:


> Yup, you are correct. I think many folks are thinking of the credit as a refund. It isn't an added $7500 to whatever your refund may be without it.
> 
> Dan


What about if you lease model 3, I thought the $7500 goes to the leasing company.


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## 18M3 (Oct 8, 2016)

MelindaV said:


> You are incorrect. California specifically requires the car is registered to you for 30 months for the credit. Some have speculated CA can come after you for a prorated amount of the credit if the car is sold. The federal credit states the car is to be purchased not to be resold to qualify for the credit. It doe st give a timeline, but may expect if audited, they may want to see proof of ownership.


Melinda, Thanks for that insight. Where did you see the CA restriction that mandates 30 months registration? It's not a major factor for me, but is one more thing to consider.


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## MelindaV (Apr 2, 2016)

18M3 said:


> Melinda, Thanks for that insight. Where did you see the CA restriction that mandates 30 months registration? It's not a major factor, but is one more thing to consider.


Let me do the research for you....

https://cleanvehiclerebate.org/eng/requirements/930

7. Retain ownership of the vehicle for a minimum of 30 consecutive months immediately after the vehicle purchase or lease date.

The original lease must be a minimum lease term of 30 months.
Only rental and car share vehicles are eligible for a reduced ownership provision if retained in California for a minimum of twelve consecutive months but less than 30 consecutive months.
8. Rebate recipients who do not retain the eligible vehicle for the full 30-month ownership or lease period will be required to reimburse ARB all or part of the original rebate amount.

Vehicle purchaser or lessee is required to notify the Administrator to arrange for early termination of vehicle ownership in advance of intent to sell or terminate a lease prior to the required 30-month ownership period.
ARB will periodically check vehicle identification numbers with vehicle registrations to ensure that CVRP applicants meet this requirement. If an applicant violates this requirement, ARB or its designee reserves the right to recoup CVRP funds from the original vehicle purchaser identified on the rebate application form and may pursue other remedies available under the law.
9. Register the new vehicle with the DMV for a minimum of 30 consecutive months from the original purchase or lease date for use in California.

Any government owned vehicle not registered with the DMV is still required to operate within California for 30 consecutive months immediately after the vehicle purchase or lease date.


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## 18M3 (Oct 8, 2016)

Ahh, perfect. That was all new info to me. I also didn't realize there are income limits for qualifying -- and lower incomes may get an extra rebate. Apparently it was part of Prop 30 that we California voters approved in 2012. Thanks for the education on my state laws!


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## AdamHolmes (Mar 31, 2017)

Dave Davenport said:


> I think someone figured out that you have to have a regular income of around $65-75k per year to have a $7500+ Federal tax bill.


That sounds about right, I'd say maybe at least 55kish. I'd think most reservations holders would be aware of this. Starting at 35k still is still a pretty high end car for what's on the road.

Does anyone know how you go about filing for this liability? Would the amount I qualify just not be taken out of next years taxes? Is there a form you have to fill out or something? I suck at understanding taxes. I know that I've had 7500 deducted from my pay in Federal income tax. So assuming I'm understanding correctly I and qualify for and could get the full credit what happens from there?


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## MelindaV (Apr 2, 2016)

It's filed as part of your return with form 9836 so if qualified, would be a credit in that years filing.
The credit is taken after others too, following EIC, etc, so you can look at your current return and see what your tax liability was when the credit would be figured in (line 47 on 1040 if I am remembering the # correctly) for an idea if above or below 7500.


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## thredge (Mar 24, 2017)

So maybe this is wishful thinking from the US, but how do you think Tesla will handle the production during the first 2 months of US tax credit phase out? I know Trevor said they can ramp up production then, but I would think this is going to be directly in line with starting to send cars out of country. Do you think they will limit the percentage going out of country, or just fulfill all the earlier US reservationists to a decided on cut off date and then work on all orders after that date on a first in line bases vs. region, even though there are tax credits quickly expiring in the US?

I mean don't get me wrong, it would be really unfair to anyone outside of the states for Tesla to say, OK for these 6 months now, we crank out all the US cars we can at everyone else's expense. But I'm not sure what he meant by his tweet about "always trying to maximize customer happiness even if that means a revenue shortfall in a quarter," in response to his question about how many people will be able to take advantage of the tax credit.

I suppose the truth is something in-between as it always is.


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## $ Trillion Musk (Nov 5, 2016)

My understanding is that (in the US) you'd qualify for the tax incentive as long as line 54 is less than line 47 in Form 1040 (attached), as an example for 2016.

https://www.irs.gov/pub/irs-pdf/f1040.pdf

Would any tax experts kindly verify?


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## MelindaV (Apr 2, 2016)

not exactly.
47 would be your tax liability prior to any credits. so any 48-54 credits would reduce that tax liability amount.
so say your 47 was $8000
minus an ed credit on 50 of $2000
and minus the EV credit of $7500
total credits in this case would be $9500, so that would zero out the $8000
Assuming the W-2 payments on line 64 were $10000, that full amount would be the refund.

compared to if there was less tax withheld on line 64:
so say your 47 was $8000
and minus the EV credit of $7500
total credits in this case would be $7500 and would reduce the liability to $500
Assuming the W-2 payments on line 64 were $9500,the refund amount would be $9000

both super simple examples, so take it as that.


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## Red Sage (Dec 4, 2016)

*Phaseout*
The credit begins to phase out for vehicles at the beginning of the second calendar quarter after the manufacturer has sold 200,000 eligible plug-in electric vehicles (i.e., plug-in hybrids and EVs) in the United States as counted from January 1, 2010. IRS will announce when a manufacturer exceeds this production figure and will announce the subsequent phase out schedule (Plug-In Electric Drive Motor Vehicle Credit Quarterly Sales).​


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## thredge (Mar 24, 2017)

Oh no, youtubes resident Tesla numbers guy (Teslanomics's Ben Sullins) goes so wrong with the US tax rebate expiration prediction.
Go, spread the love and tell him how he hath fouled up, hence.


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## MelindaV (Apr 2, 2016)

thredge said:


> Oh no, youtubes resident Tesla numbers guy (Teslanomics's Ben Sullins) goes so wrong with the US tax rebate expiration prediction.
> Go, spread the love and tell him how he hath fouled up, hence.


yeah - there's been a couple things I've noticed him stating as fact that have not been correct. 
People need to remember just because someone has a Youtube channel does not mean they know what they are talking about.


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## thredge (Mar 24, 2017)

MelindaV said:


> yeah - there's been a couple things I've noticed him stating as fact that have not been correct.
> People need to remember just because someone has a Youtube channel does not mean they know what they are talking about.


I was fairly disappointed because he made it 1/4 of the live podcast and went into detail about how the credit won't even make it to the end of the year, then way at the end, people are trying to correct him and help him get it right, but he shrugs it off. As he rambles out their post you can hear them saying, "...but how many US cars?" and "it's only for US cars," they were trying to help him. His final response was, "...it could be only for US cars, maybe that would make sense, I dunno, I'm not a tax guy."  
The wind just fell out of my sales. What? You spend 1 of the 3 questions you addressed answering how the US credit isn't going to be ther for any of the Model 3 reservationists except for maybe the very first handful to get the car, then you don't even say, oh, all that stuff I said was wrong, you just go, OK, maybe? 

I was sad. So very, very sad.


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## Red Sage (Dec 4, 2016)

I guess I'll watch it later, on YouTube. Maybe comment with a link to this thread.

I will note though, that way back in early 2013, Elon Musk began warning Tesla Enthusiasts that the Federal Tax Credit and other EV Incentives may not be around by the release of Generation III cars. At the time, he seemed to be saying that either: 1) Things would go very well for Tesla, and the Federal Tax Credit would be phased out first; or 2) That political concerns might change with the wind and that EV Incentives would be on the chopping block out of political expedience. Either way, he felt that no one should count on receiving such benefits. This was part of an answer to a query about whether the $35,000 price he quoted was 'before or after incentives'. He stated clearly then, as now, that price is always BEFORE any incentives at all.


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## patrick0101 (Apr 4, 2016)

The Q1'17 sales data is out. This puts Tesla at ~122,000 US sales so far. Less than 80k to trigger the start of the tax credit phase out. I've updated my estimate here:

*Will You Get The $7500 Federal Incentive For Your Model 3?*

tl;dr: Credit likely to last through Sept'18 and early reservation holders are highly likely to receive the credit.

If Tesla can ramp Model 3 production faster than estimated, then the credit expires sooner, but the number of people that receive the credit is nearly the same, you just get your car sooner.


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## garsh (Apr 4, 2016)

patrick0101 said:


> I've updated my estimate here:


Your table says 2020 instead of 2019 for the last three columns.


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## patrick0101 (Apr 4, 2016)

garsh said:


> Your table says 2020 instead of 2019 for the last three columns.


Yes it did. Thank you for the detailed review. It's now corrected.


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## TrevP (Oct 20, 2015)

Red Sage said:


> I guess I'll watch it later, on YouTube. Maybe comment with a link to this thread.
> 
> I will note though, that way back in early 2013, Elon Musk began warning Tesla Enthusiasts that the Federal Tax Credit and other EV Incentives may not be around by the release of Generation III cars. At the time, he seemed to be saying that either: 1) Things would go very well for Tesla, and the Federal Tax Credit would be phased out first; or 2) That political concerns might change with the wind and that EV Incentives would be on the chopping block out of political expedience. Either way, he felt that no one should count on receiving such benefits. This was part of an answer to a query about whether the $35,000 price he quoted was 'before or after incentives'. He stated clearly then, as now, that price is always BEFORE any incentives at all.


Exactly. Tesla has always been very clear with Model 3 pricing. They have only ever referred to the base price of $35K. GM however is actively touting the Bolt as $29K after the tax credit. Tesla knows fully well that the credit will go away and don't want to get caught up in false pricing accusations. It also sets the expectation for a future as if the tax credit didn't exist.

I like Ben but in this case he should have done a bit more research into how the credit phaseout works before answering questions. I'm not a tax guy either so I can't speak to how you go about claiming the credit on US income (I'm Canadian after all) but I do know not everyone qualifies since you have to have at least $7500 in tax exposure to claim the full amount. Claiming it's a rebate is false.

A rebate means no encumberments. Ontario's EV rebate is in the truest sense of the word: a cheque you get in the mail without any income tax implications. Spend it as you see fit


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## Red Sage (Dec 4, 2016)

@TrevP -- Precisely. By the same token, I feel the terms _'Incentive'_, _'Rebate'_, and _'Subsidy'_ all mean different things. Though they are closely related, they are not interchangeable. Tesla Naysayers never seem to want to acknowledge the differences, though. The way I see it:

The Federal EV Tax Credit is an Incentive to purchase.
The Great State of Louisiana offers a tremendous Rebate for the purchase of a Tesla product.
A Subsidy would be funds paid directly to Tesla Motors by the Government for each vehicle they sell.
I find it really frustrating that FUDsters claim that the ZEV Credits that Tesla earns are _'subsidies'_. They are not. ZEV Credits have existed since 1990. They persist as an Incentive to traditional automobile manufacturers to build compliance cars for sale/lease in California and other CARB _(California Air Resources Board)_ States. The conditions to receive ZEV Credits are in no way exclusive to Tesla and are readily available to any and all automobile manufacturers that choose to take advantage of them.

The traditional automobile manufacturers themselves successfully lobbied for ZEV Credits as a means to limit their exposure to penalties for not meeting CAFE _(Corporate Average Fuel Economy)_ ratings imposed by the NHTSA. They argued that since the low emissions and zero emissions vehicles that California required be offered in order to continue selling ICE vehicles there tended to be more expensive to build, did not sell in large quantities _(because _'no one wanted them'_)_, but also had higher fuel economy ratings than _'normal'_ cars, they should also receive a Federal benefit against their overall CAFE score for all their hard work. They also asked that companies that already had relatively fuel efficient fleets could sell their ZEV Credits to other manufacturers, if they earned _'extras'_.

The Government agreed, and the ZEV Credit program went into effect 13 years before Tesla was founded, 18 years before their first cars were sold. Yet FUDsters continue to act as if ZEV Credits are a special program developed by the government to support _'Obama's Green Agenda'_ and specifically to give away billions of dollars to Tesla as a means to _'pick winners and losers'_ along with a bunch of other loaded political [BOLSHEVIK]. Nope. ZEV Credits are an addendum to a program designed to reduce smog in California while improving health conditions & promoting clean air technologies for transportation, and benefit traditional automobile manufacturers by allowing them to boost their CAFE rating above their actual numbers _(while selling even more gas guzzling pickup trucks and SUVs)_. ZEV Credits have nothing whatsoever to do with being a _'Carbon Tax'_ or whatever.

Thing is...? No one anticipated that a new automobile manufacturer would emerge with an intent to build and sell nothing but clean air, zero emissions, fully electric cars that were completely eligible for ZEV Credits at the maximum allowable rate per vehicle. Oops. CARB couldn't eliminate the ZEV Credits, because that would remove the primary motivation for traditional automobile manufacturers at least having a token presence with compliance cars in California. Tesla followed all of the rules for eligibility, CARB couldn't directly punish them for being an example of exactly what their own charter claimed to set off to accomplish.

Because most members of the CARB panel were pretty much all former/future employees of, or consultants to, the traditional automobile manufacturers, they didn't necessarily believe in clean technologies themselves and pretty much were only there to enable the status quo to remain in place while _'making it look good'_ for all of the unwashed, barefoot, longhaired, commie, pinko, hippie treehuggers who wouldn't keep their mouths shut about _'the environment'_ and stuff... CARB was really there to make sure business as usual continued without much effort or inconvenience. Traditional automobile manufacturers basically had to truly [FOUL] up to get in serious trouble, as seen with Volkswagen in the past couple of years.

ZEV Credits, in and of themselves, have no value whatsoever. No one among traditional automobile manufacturers is required to earn ZEV Credits. They can simply choose to not do business in California, if their annual sales exceed a certain threshold and they don't want to build compliance cars. No one among traditional automobile manufacturers is required to purchase ZEV Credits. They can choose to either build fuel efficient cars that meet CAFE requirements, or they can choose to pay the fines associated with not meeting CAFE. No one among traditional automobile manufacturers is required to purchase ZEV Credits from Tesla. They can choose to give Tesla _'The FINGER'_ and go about their way if they see fit. No one in the California or Federal Government will give Tesla a single, solitary, flat dime for earning ZEV Credits -- they don't buy them from Tesla at all. But the FUDsters would have you believe the exact opposite of the truth on each and every one of those points.

There is an applied fine of something like $5,000 per car for every point by which a traditional automobile manufacturer is short of the required CAFE rating for their fleet sold in the U.S. Some low volume high end manufacturers simply raise the price of their vehicles by that amount and pass the cost on to their Customers in order to maintain the _'integrity'_ of their commitment to ICE -- then they pay the fine that the NHTSA requires -- that is separate from whatever gas guzzler tax is applied to the Customer at purchase. Many manufacturers apply their ZEV Credits against their own CAFE rating to boost the numbers closer to, or over the required amount. Some of them have extra ZEV Credits due to being well over the needed CAFE mark, so they can sell them to other companies, typically for less than the $5,000 fine amount, at a negotiated rate between the parties involved.

The ZEV Credits are assigned by the Great State of California simply for the compliance cars being _'offered'_ in the State, whether they actually sell or are leased to end users or not. And, not only do the companies that earn those ZEV Credits get to stockpile them two years in a row, they are given credit against CAFE both years. And, for every ZEV Credit they earn in California, they receive a bonus percentage of them relative to CA sales in each of every other State in the nation where they do NOT offer the same compliance cars. Meanwhile, if Tesla doesn't have anyone to buy their ZEV Credits, they only get a benefit from them the one time they sell them, and nothing at all the following year. Hence, why Elon says that Tesla gets 'half the value' of ZEV Credits compared to everyone else, just because they do not offer ICE vehicles.


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## garsh (Apr 4, 2016)

My attention span is too short to make it through a post like that. But I did make it this far, and wanted to comment:


Red Sage said:


> I find it really frustrating that FUDsters claim that the ZEV Credits that Tesla earns are _'subsidies'_. They are not.


More importantly, ZEV credits allow the traditional automakers to continue making & selling fuel-inefficient vehicles. When they don't meet the required Corporate Average Fuel Economy values, they can purchase ZEV credits (often from Tesla) to make up the difference and avoid punishment.

Getting rid of ZEV credits would probably end up hurting GM and Ford a lot more than it would hurt Tesla.


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## Red Sage (Dec 4, 2016)

garsh said:


> My attention span is too short to make it through a post like that. But I did make it this far, and wanted to comment:
> More importantly, ZEV credits allow the traditional automakers to continue making & selling fuel-inefficient vehicles. When they don't meet the required Corporate Average Fuel Economy values, they can purchase ZEV credits (often from Tesla) to make up the difference and avoid punishment.
> 
> Getting rid of ZEV credits would probably end up hurting GM and Ford a lot more than it would hurt Tesla.


Yup. I believe I made a similar point later on. Didn't expect that to get so long... But each time I explained one point, more needed to be said. 

_The traditional automobile manufacturers themselves successfully lobbied for ZEV Credits as a means to limit their exposure to penalties for not meeting CAFE _(Corporate Average Fuel Economy)_ ratings imposed by the NHTSA._

_... _

_ZEV Credits are an addendum to a program designed to reduce smog in California while improving health conditions & promoting clean air technologies for transportation, and benefit traditional automobile manufacturers by allowing them to boost their CAFE rating above their actual numbers _(while selling even more gas guzzling pickup trucks and SUVs)_. ZEV Credits have nothing whatsoever to do with being a _'Carbon Tax'_ or whatever._​


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## Badback (Apr 7, 2016)

Red Sage said:


> Yup. I believe I made a similar point later on. Didn't expect that to get so long... But each time I explained one point, more needed to be said.
> 
> _The traditional automobile manufacturers themselves successfully lobbied for ZEV Credits as a means to limit their exposure to penalties for not meeting CAFE _(Corporate Average Fuel Economy)_ ratings imposed by the NHTSA._
> 
> ...


For their mindset, ideology is more important than truth.


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## Red Sage (Dec 4, 2016)

Badback said:


> For their mindset, ideology is more important than truth.


Yes. Denial of facts, evidence, and scientific results is paramount for those who insist that anything ecologically related is a _'waste of time and money'_.


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## JBsC6 (Oct 17, 2016)

I believe we will get to January 1 st 2018 before tesla hits 200000 vehicle mark.

Then we will have six months of full govt $7500 tax credit...then six months of $3750 tax credit...and with that I believe all 372k preorders will be filled and delivered....

The ramp up in July and throughout 2017 will be moderate but once the 200000 tesla is delivered...I'm assuming tesla will put,p out the vehicles like never before for 4 straight quarters...

I'd like to see the state sales tax rebate be continued as well. That's another 7 percent for many of us...

Might just pay to buy that model S P100d now after all,,.(kidding as it really is too big a vehicle for most of us)

Crazy fast though that's for sure


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## Carl (Apr 5, 2016)

JBsC6 said:


> I believe we will get to January 1 st 2018 before tesla hits 200000 vehicle mark.
> 
> Then we will have six months of full govt $7500 tax credit...then six months of $3750 tax credit...and with that I believe all 372k preorders will be filled and delivered....
> 
> ...


Don't forget that the 372k included a significant amount from outside the US. Therefore almost all original preorders from US should qualify for the full $7,500 credit.


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## SoFlaModel3 (Apr 15, 2017)

If the Model 3 production scales as Tesla currently plans ... then it looks like car 200k in the US hits in the 4th quarter of this year. 

That would be $7,500 through end of Q1 2018
$3,750 through end of Q3 2018
$1,865 through end of Q1 2019

I'm following closely ... personally I only need/want 60 kWh, but getting 60 kWh could cost me $3,750 in credit money. The 75 kWh could be a "free upgrade" in theory for those that don't want it but were early reservations. Not to mention, I don't want to wait anyway.


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## thredge (Mar 24, 2017)

I hope they hold over until the first part of Q1 to push it out just a little more. Would be so great for so many more people.


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## SoFlaModel3 (Apr 15, 2017)

thredge said:


> I hope they hold over until the first part of Q1 to push it out just a little more. Would be so great for so many more people.


Elon went on the record saying he would "do the right thing" which would imply that possibility. That said, we know the US gets Model 3 first and if Model S and X sales remain hot they could be sitting on a lot of undelivered cars if they attempt to hold them for January.


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## garsh (Apr 4, 2016)

SoFlaModel3 said:


> they could be sitting on a lot of undelivered cars if they attempt to hold them for January.


Alternatively, they decide to fulfill a bunch of Canadian orders until the start of the next quarter.


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## SoFlaModel3 (Apr 15, 2017)

garsh said:


> Alternatively, the decide to fulfill a bunch of Canadian orders until the start of the next quarter.


That's true, they could sit on S and X orders bound for US customers.

However, if they scale to 80,000 cars in 2017 (yes someone tag this post as optimistic), it's a moot point. The phase out will begin this year.


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## Johnm6875 (Nov 14, 2016)

garsh said:


> Alternatively, the decide to fulfill a bunch of Canadian orders until the start of the next quarter.


Or, Europe. I'm sure Michael Russo is very anxiously waiting and would be thrilled.


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## JBsC6 (Oct 17, 2016)

Only a fool would push past the 200k units delivered in December 2017 as opposed to January 2018.

The $7500 tax credit will last for two quarters after delivering the 200000 tesla vehicle.

Then for 2 quarters it will be slashed in half to 3750 for two quarters and then the tax credit will be slashed in half again to 1875 for two quarters.

I would imagine as close to 200k units sold is to arrive in January 2018 Elon Musk will produce but not deliver as May model 3 s for sale and create an inventory to ship out across the country for an intense January delivery.

JMO


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## SoFlaModel3 (Apr 15, 2017)

JBsC6 said:


> Only a fool would push past the 200k units delivered in December 2017 as opposed to January 2018.
> 
> The $7500 tax credit will last for two quarters after delivering the 200000 tesla vehicle.
> 
> ...


Yes the best scenario for the most people would be car 200k delivered in the US on 1/1/18. That will give the longest life to the tax credit possible and hit the most Model 3 buyers with the full $7,500.


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## JBsC6 (Oct 17, 2016)

I know if I were in charge of tesla and wanted as many satisfied consumers I would follow the delivery plan I mentioned above.

I'd just produce as many a single possible prior to January 2018 and place in inventory for a few days before January 1st and then transport all the teslas to the dealerships for new customers and those even considering a tesla model three to view..and then I'd release them so a tital wave of model 3 s began to travel the streets in a wave come the new year...


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## Johnm6875 (Nov 14, 2016)

JBsC6 said:


> I know if I were in charge of tesla and wanted as many satisfied consumers I would follow the delivery plan I mentioned above.
> 
> I'd just produce as many a single possible prior to January 2018 and place in inventory for a few days before January 1st and then transport all the teslas to the dealerships for new customers and those even considering a tesla model three to view..and then I'd release them so a tital wave of model 3 s began to travel the streets in a wave come the new year...


Not just satisfied customers but, like me, many will convert tax credit money into additional options on the 3 which will generate more profit for Tesla.


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## JWardell (May 9, 2016)

Two reasons I hope to get delivery in December, although it doesn't seem likely:
-Getting the tax credit in April 2018, when I could use it to cover costs of this really expensive car I just bought, vs getting it in April 2019
-Will Trump find a way to kill this off? I'm more than a little concerned EV credits could be cancelled by 2019.

The estimator puts me at the first week of January...I hope Tesla manages to push just a few thousand ahead of estimates!


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## SoFlaModel3 (Apr 15, 2017)

JWardell said:


> Two reasons I hope to get delivery in December, although it doesn't seem likely:
> -Getting the tax credit in April 2018, when I could use it to cover costs of this really expensive car I just bought, vs getting it in April 2019
> -Will Trump find a way to kill this off? I'm more than a little concerned EV credits could be cancelled by 2019.
> 
> The estimator puts me at the first week of January...I hope Tesla manages to push just a few thousand ahead of estimates!


Don't forget if you get the car in early 2018, you can take the deduction out of each paycheck evenly. Could offset monthly payments if you're financing. You don't have to wait until April to "get" the credit.


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## garsh (Apr 4, 2016)

JWardell said:


> -Will Trump find a way to kill this off? I'm more than a little concerned EV credits could be cancelled by 2019.


Unlikely. If anything, the other automakers are going to use the credit as a tool to combat Tesla (because Tesla will run out, but it will be available for them), so they'll push *against* eliminating it.


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## Red Sage (Dec 4, 2016)

Keep in mind that by Delivering the 200,000th car in January 2018 instead of December 2017, Tesla will also greatly increase the number of people who can get the trailing 25% credit amount at $1,875 -- because their ramp to 10,000 units per week should have been reached by then.


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## DaGlot (Apr 4, 2016)

Yes with at least 40% headed overseas for S & X, I imagine that they could divert some 3 as well to right side driving countries to keep us on for Jan 2 or 3rd. If they do it well, and they have all the production info, they could keep enough flow US side to keep grumbling down. It just would mean Xmas is less likely than January for those of us early in line. Worth it I'd say.


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## Johnm6875 (Nov 14, 2016)

DaGlot said:


> Yes with at least 40% headed overseas for S & X, I imagine that they could divert some 3 as well to right side driving countries to keep us on for Jan 2 or 3rd. If they do it well, and they have all the production info, they could keep enough flow US side to keep grumbling down. It just would mean Xmas is less likely than January for those of us early in line. Worth it I'd say.


Might mean close to a Billion $US extra in tax credits. Very worth it!


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## Michael Russo (Oct 15, 2016)

DaGlot said:


> Yes with at least 40% headed overseas for S & X, I imagine that they could divert some 3 as well to right side driving countries to keep us on for Jan 2 or 3rd. If they do it well, and they have all the production info, they could keep enough flow US side to keep grumbling down. It just would mean Xmas is less likely than January for those of us early in line. Worth it I'd say.


Just as a reminder, 'overseas', for instance in most of Western Europe, except for the U.K. & Eire (+ possible Gibraltar & Malta...) does not mean RHD (right hand drive) as we drive on the same side of the road as you in North America... . Same in China (another LHD country), whilst Singapore, India, Japan & Australia also kept RHD (trust our kiwi friends in New Zealand too yet not sure).

RHD will only be shipped normally after some LHD 'overseas' shipments, I doubt that will be happen in 2017...


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## thredge (Mar 24, 2017)

I agree, it would be so cool if they push that 200,000th into January however they work it out. I know it doesn't mean much (because I'm not), but if I was an early reservation holder, I wouldn't mind putting off my delivery for a little bit to help get more people the best tax credit. Greater good and all. The rest of the community might not feel that way though. It does seem like that would be in Tesla's interest too, and would provide more interest for longer in all the cars.

I can't wait to see how Musk and Tesla play it out though.


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## JDTM3 (May 29, 2017)

Any CA owners hoping to combine the federal tax credit with the California Clean Vehicle Rebate Program (CVRP) for the model 3? 

I was #146 in line in a So Cal store on day 1 so i think i'm in good shape to get the full $7500 credit and looks like i qualify for an additional $2500 CA credit. Hoping it works out.


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## JBsC6 (Oct 17, 2016)

Read an article last night that says tesla can't produce more than 235k model 3 units out of Fremont plant in the year 2018.

Doesn't look good for us who might be number 240k (put a deposit down after a test drive of an S April 2nd) to get the federal tax credit.. that was a $7500 test drive...


Oh well...what can you do...except laugh it off. Still a great car.

I'm digging the photos of the interior with the exception of the horrible wood trim.


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## SoFlaModel3 (Apr 15, 2017)

JBsC6 said:


> Read an article last night that says tesla can't produce more than 235k model 3 units out of Fremont plant in the year 2018.
> 
> Doesn't look good for us who might be number 240k (put a deposit down after a test drive of an S April 2nd) to get the federal tax credit.. that was a $7500 test drive...
> 
> ...


I wouldn't make any assumptions yet. If Tesla scales to 5k cars a week by end of 2017, they're already ahead of what you're reporting and they've said they aim to scale to 10k a week at some point in 2018.


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## Reef Club (Jun 18, 2017)

Section 2 of IRS Bulletin: 2009-48)
"The new qualified plug-in electric drive motor vehicle credit phases out for a manufacturer's vehicles over the one-year period beginning with the *second calendar quarter after* the calendar quarter in which at least 200,000 qualifying vehicles manufactured by that manufacturer have been sold for use in the United States"
Elon Musk will drag out 200,000 sale to January 2018 which means if you receive Model 3 before July1, 2018 you get the full tax credit


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## ModFather (Apr 3, 2016)

Reef Club said:


> Section 2 of IRS Bulletin: 2009-48)
> "The new qualified plug-in electric drive motor vehicle credit phases out for a manufacturer's vehicles over the one-year period beginning with the *second calendar quarter after* the calendar quarter in which at least 200,000 qualifying vehicles manufactured by that manufacturer have been sold for use in the United States"
> Elon Musk will drag out 200,000 sale to January 2018 which means if you receive Model 3 before July1, 2018 you get the full tax credit


Consider this, Tesla has already delivered 127K cars since 2010 when the legislation took effect. So that means he will drag out 73K model S/3/X deliveries to meet the threshold which could be Q4/2017 which IF that occurs you will have to take delivery of any Tesla prior to 4/1/2018 to be eligible for the full tax credit. If EM can't deliver 73K cars in 6 months (Jul - Dec, 2017) he is really going to get hammered in the press and the stock will take a beating. I think he is going to deliver 73K cars in 14 weeks (July through the first week in October) or an average of 5000 per week to keep the press happy, investors happy, and extend the full tax credit to 3/31/2018.


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## SoFlaModel3 (Apr 15, 2017)

Reef Club said:


> Section 2 of IRS Bulletin: 2009-48)
> "The new qualified plug-in electric drive motor vehicle credit phases out for a manufacturer's vehicles over the one-year period beginning with the *second calendar quarter after* the calendar quarter in which at least 200,000 qualifying vehicles manufactured by that manufacturer have been sold for use in the United States"
> Elon Musk will drag out 200,000 sale to January 2018 which means if you receive Model 3 before July1, 2018 you get the full tax credit


I know everyone is hoping car 200,000 is titled on 1/1/18, but I still can't help but think it happens in Q4 2017.


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## Reef Club (Jun 18, 2017)

ModFather said:


> Consider this, Tesla has already delivered 127K cars since 2010 when the legislation took effect. So that means he will drag out 73K model S/3/X deliveries to meet the threshold which could be October 2017 which IF that occurs you will have to take delivery of any Tesla prior to 4/1/2018 to be eligible for the full tax credit..


Selfishly I must state that I reserved 04 /01/2016 so I feel comfortable that I will get the full $7,500 tax credit even if they deliver 200k cars in October 2017.


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## kendthomp (Apr 24, 2016)

While getting ANY assistance in the form of a tax rebate is wonderful, that isn't the reason I'm so excited about owning a Tesla M3. It simply lowers the cash outlay for a car I would gladly purchase anyway...


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## ModFather (Apr 3, 2016)

Reef Club said:


> Selfishly I must state that I reserved 04 /01/2016 so I feel comfortable that I will get the full $7,500 tax credit even if they deliver 200k cars in October 2017.


Being a second day reservationist from the other Sunshine State, I think there is an excellent chance you will get a car that is eligible for the full tax credit IF you are flexible on options.


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## dudeman (Jun 20, 2017)

ModFather said:


> Consider this, Tesla has already delivered 127K cars since 2010 when the legislation took effect. So that means he will drag out 73K model S/3/X deliveries to meet the threshold which could be Q4/2017 which IF that occurs you will have to take delivery of any Tesla prior to 4/1/2018 to be eligible for the full tax credit. If EM can't deliver 73K cars in 6 months (Jul - Dec, 2017) he is really going to get hammered in the press and the stock will take a beating. I think he is going to deliver 73K cars in 14 weeks (July through the first week in October) or an average of 5000 per week to keep the press happy, investors happy, and extend the full tax credit to 3/31/2018.


Yes, Investors of course wants to see more sales but they don't care if sales are in us or somewhere else. It would be wise for EM to hit. 200k in USA in q1 18 when production ramp up is there. Sale additional inventories to our friends in north till then. May be that will make Trevor happy as well.  Something special from EM (early delivery)


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## SoFlaModel3 (Apr 15, 2017)

dudeman said:


> Yes, Investors of course wants to see more sales but they don't care if sales are in us or somewhere else. It would be wise for EM to hit. 200k in USA in q1 18 when production ramp up is there. Sale additional inventories to our friends in north till then. May be that will make Trevor happy as well.  Something special from EM (early delivery)


From another perspective ... an American company with a large backlog in the States exporting more cars is also a negative.


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## dudeman (Jun 20, 2017)

SoFlaModel3 said:


> From another perspective ... an American company with a large backlog in the States exporting more cars is also a negative.


1. The excess product export is to help more American consumers get full credit
(They could choose to keep excess and release it in q1 18, especially given their low del target of 100k)

2. Large number of tesla customers are non American. Show them love too.
They stood in line on the first day too. One can argue that Its kinda unfair that they have wait longer.

3. Its good for business.

4. Its good for me - the investor.


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## SoFlaModel3 (Apr 15, 2017)

dudeman said:


> 1. The excess product export is to help more American consumers get full credit
> (They could choose to keep excess and release it in q1 18, especially given their low del target of 100k)
> 
> 2. Large number of tesla customers are non American. Show them love too.
> ...


I have to say I disagree all around.

1) They don't owe us the consumer "more credits". We will be fortunate to get the credits. No matter what a lot of people are going to get big credits whether it's the full boat, 50%, or 25%. In fact if they scale to plan, everyone with a reservation will at least get some of the credit and that's impressive.

2) Of course show love to the non-American consumers, but ... (1) it goes against what Elon initially said and (2) on some level exporting the car before fulfilling in your own backyard is a bad look.

3) Is it good for business? Selling cars is good for business. Not making cars and sitting on them without get paid until a later date. Side note holding back deliveries will only further strain the delivery process making things worse not better.

4) The investor ... well I'm an investor as well. Tesla is a fan boy stock. It trades heavy on magic dust and future and little on conventional wisdom. I'm ok with that and along for the ride. That said, the investor will want to see Model 3 scale properly and reservations convert to orders.


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## ModFather (Apr 3, 2016)

SoFlaModel3 said:


> From another perspective ... an American company with a large backlog in the States exporting more cars is also a negative.


Originally I gave you an "agree" but after thinking about it, I undid that rating (sorry SFM3 ) and now rate this post as a "meh." I think the bulk of deliveries will be US based, but there will be a number of US reservationists who will defer our order to get a custom built car with desired options and perhaps not qualify for the full tax credit. So that will open up opportunities for foreign deliveries for those reservationists who want the car right away and are willing to accept an inventory car with factory selected options. It is sort of like our government's "self deportation" program that was proposed several years ago.


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## dudeman (Jun 20, 2017)

Smf3, Absolutely fine for you to disagree. These are just my thoughts. I could be dead wrong.

I will be looking forward to see how this will turn out.


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## SoFlaModel3 (Apr 15, 2017)

ModFather said:


> Originally I gave you an "agree" but after thinking about it, I undid that rating (sorry SFM3 ) and now rate this post as a "meh." I think the bulk of deliveries will be US based, but there will be a number of US reservationists who will defer our order to get a custom built car with desired options and perhaps not qualify for the full tax credit. So that will open up opportunities for foreign deliveries for those reservationists who want the car right away and are willing to accept an inventory car with factory selected options. It is sort of like our government's "self deportation" program that was proposed several years ago.


Well truth be told we should start to get a better sense for this in July. At the moment we're all speculating. I think I'm just starting to go a little crazy. Typically I am an instant gratification type of person and waiting for things is not a trait that I possess. Here we are 15 months after the reservation and anywhere from one to four weeks away from having all of the questions answered and I just can't take it anymore!!! 



dudeman said:


> Smf3, Absolutely fine for you to disagree. These are just my thoughts. I could be dead wrong.
> 
> I will be looking forward to see how this will turn out.


I can be dead wrong as well


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## garsh (Apr 4, 2016)

We (as a group) seem to focus in on when the 200,000th delivery will take place. That is important, since timing it "just right" results in an additional 3 months worth of sales qualifying for credits. But it's actually not the most important thing to focus on.

What's more important is for Tesla to very quickly ramp up production. If they time the 200,000th delivery perfectly (beginning of a quarter), but only manage to ramp up to 1000 cars/week, then that would result in:

24,000 people getting $7500 credit (6 months)
24,000 people getting $3750 credit (6 months)
24,000 people getting $1875 credit (6 months)
On the other hand, even if they time the 200,000th vehicle delivery as poorly as possible (end of a quarter), BUT they are able to quickly reach 4000 cars/week, then we get:

48,000 people getting $7500 credit (3 months)
96,000 people getting $3750 credit (6 months)
96,000 people getting $1875 credit (6 months)
So, production ramp-up is MUCH more important if Elon is trying to get rebates for as many reservation holders as possible, moreso than the cutoff date. I think Tesla will delay a_ few days worth of _deliveries if they're on target to hit the cutoff at the end of a quarter, but I don't expect them do anything more drastic than a few days. They'll concentrate on ramping up production instead.


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## ModFather (Apr 3, 2016)

garsh said:


> What's more important is for Tesla to very quickly ramp up production.


@garsh, brilliant analysis! I agree, and that's why I think the 200K threshold will occur in Q4/2017.....and TSLA will go through the roof!


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## SoFlaModel3 (Apr 15, 2017)

ModFather said:


> @garsh, brilliant analysis! I agree, and that's why I think the 200K threshold will occur in Q4/2017.....and TSLA will go through the roof!


That's what I've been saying! I think they hit the production targets and ramp to 5,000 cars a week (or at least very closed before Q4 is over)!


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## garsh (Apr 4, 2016)

SoFlaModel3 said:


> That's what I've been saying!


I think a simplified example with numbers helps drive the point home.


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## Reef Club (Jun 18, 2017)

I still want the 21.4% price break with a $7,500 tax credit. Based on tweets last Sunday still looking good for the 200,000 US sale/delivery in 1Q 2018. I can use money for upgrades on M3, Tesla Wall Connector or toward a Tesla pick up truck down the road.


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## dudeman (Jun 20, 2017)

Reef Club said:


> I still want the 21.4% price break with a $7,500 tax credit. Based on tweets last Sunday still looking good for the 200,000 US sale/delivery in 1Q 2018. I can use money for upgrades on M3, Tesla Wall Connector or toward a Tesla pick up truck down the road.


You are right. I believe 200k will happen at the very beginning of q1 18 with 5k/week ramp and hopefully get close to 8-10k/week by end of q1. Production ramp up and 200k delivery has to coincide, most likely to happen in q1 18.


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## SoFlaModel3 (Apr 15, 2017)

Reef Club said:


> I still want the 21.4% price break with a $7,500 tax credit. Based on tweets last Sunday still looking good for the 200,000 US sale/delivery in 1Q 2018. I can use money for upgrades on M3, Tesla Wall Connector or toward a Tesla pick up truck down the road.


It does look more and more likely that 200k drops in January and the $7,500 federal tax credit runs through 6/30/2018. That said, it still is not a lock that it will apply to a $35k base Model 3 and we do not know the full ramp plan and all we know right now is that early cars will likely fill in the mid-level trim with anyone's guess on price running from $42-50k I would anticipate.


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## Mark C (Aug 26, 2016)

SoFlaModel3 said:


> That said, it still is not a lock that it will apply to a $35k base Model 3 and we do not know the full ramp plan and all we know right now is that early cars will likely fill in the mid-level trim with anyone's guess on price running from $42-50k I would anticipate.


I really hope we aren't forced to buy one at near $50k. I'd have to defer placing my order. I won't buy a $50k car, not even a Tesla......and I really want to be part of this once in a lifetime EV feast!


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## SoFlaModel3 (Apr 15, 2017)

Mark C said:


> I really hope we aren't forced to buy one at near $50k. I'd have to defer placing my order. I won't buy a $50k car, not even a Tesla......and I really want to be part of this once in a lifetime EV feast!


You won't be forced to buy a $50k car, but Elon is on the record saying the initial cars will be the larger battery pack which if you believe they will go to bundling in tiers like what we're seeing with S/X now (Standard, Premium, and Performance) then you could surmise the initial cars will be "Premium" and so I would anticipate they land in the $50k range. I have prepared myself for that. It will certainly be the most expensive car I have purchased by quite a bit. (~$12k or so).

In any event, what does it all mean?

Well, signs seem to point toward the 200,000th car dropping in January.

That means for the following...

$7,500 tax credit runs through 6/30/2018
$3,750 tax credit runs 7/1/2018 - 12/31/2018
$1,875 tax credit runs 1/1/2019 - 6/30/2019
No credit beginning on 7/1/2019.

The good news is that if you defer for the standard model you're going to get some kind of credit. My best guess is you fall back to the $3,750 credit. Again just a guess though...

Also, if Tesla hits 200,000 US cars in December than each increment jumps up one full quarter.

Either way -- a lot of people getting a lot of credits.

I'm banking on the car being delivered to me within 1st quarter 2018 (stretching for 4th quarter 2017 which would be a dream). Both of those quarters seem very solid for the full $7,500 right now!


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## dudeman (Jun 20, 2017)

Mark C said:


> I really hope we aren't forced to buy one at near $50k. I'd have to defer placing my order. I won't buy a $50k car, not even a Tesla......and I really want to be part of this once in a lifetime EV feast!


I think by the beginning of Q2, they will have all packages they are going to offer in in place(AWD,base battery and all other options). You will get whatever they are going to offer with model 3 starting Q2. You will still qualify for full credit as well if you had an early reservation. If you are ok with deferring for a month or two, you would be just fine. Yes, it would be once in a lifetime EV feast!!!


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## KennethK (Oct 13, 2016)

dudeman said:


> I think by the beginning of Q2, they will have all packages they are going to offer in in place(AWD,base battery and all other options). You will get whatever they are going to offer with model 3 starting Q2. You will still qualify for full credit as well if you had an early reservation. If you are ok with deferring for a month or two, you would be just fine. Yes, it would be once in a lifetime EV feast!!!


Remember that in order for you to qualify for the credit, it is based on the day you register your vehicle with the DMV and that can take a long time... order vehicle, wait for it to be built, wait for it to be transported, wait for it to be delivered to you, wait for the paperwork to register it with the DMV.


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## dudeman (Jun 20, 2017)

KennethK said:


> Remember that in order for you to qualify for the credit, it is based on the day you register your vehicle with the DMV and that can take a long time... order vehicle, wait for it to be built, wait for it to be transported, wait for it to be delivered to you, wait for the paperwork to register it with the DMV.


https://www.irs.gov/businesses/plug-in-electric-vehicle-credit-irc-30-and-irc-30d

I thought it has to be "sold", ( i.e. delivery taken, payment made, title on the customer name) during qualified period. I never had to deal with DMV directly purchasing a new car. The dealership just gave me everything on the day of purchase.

They would probably sell last week of inventory in the bay area, close to production facility so it can be delivered within qualified time frame.


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## garsh (Apr 4, 2016)

dudeman said:


> https://www.irs.gov/businesses/plug-in-electric-vehicle-credit-irc-30-and-irc-30d
> 
> I thought it has to be "sold", ( i.e. delivery taken, payment made, title on the customer name) during qualified period.


I was thinking that too, but it also states that the vehicle must be "put in service". So that probably means it must be registered with a state so that you can legally drive it on public roads.

Ref: Instructions for Form 8936


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## ModFather (Apr 3, 2016)

SoFlaModel3 said:


> That means for the following...
> 
> $7,500 tax credit runs through 6/30/2018
> $3,750 tax credit runs 7/1/2018 - 12/31/2018
> ...


In general, I agree with your assessment. But going back to the "elusive $35K model 3" thread, I think that someone wishing to purchase a $35K standard base model 3 and qualifying for the full $7,500 tax credit (thus making it a $27.5K car) are growing increasing slim. That was my premise in that thread, and I think there are going to be some disappointed reservationists who are hoping to purchase a Tesla for under $30K.


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## Ode to Joy (Mar 11, 2017)

garsh said:


> I was thinking that too, but it also states that the vehicle must be "put in service". So that probably means it must be registered with a state so that you can legally drive it on public roads.
> 
> Ref: Instructions for Form 8936


The IRS Instructions Form 8936 states that you qualify for the Federal Tax Credit "as long as you purchased the vehicle on or before the date the IRS published the withdrawal announcement." Further down it states under requirements to be met to qualify...."you place the vehicle in service during your tax year." I interpret that to mean that putting the car "into service" is not linked with the purchase date which decides the level of tax credit, it just means it has to be put into service sometime during that tax year. Also the manufacturer, ie Tesla, is sending to the IRS a list of vehicles for each quarter that meets the requirements for the tax credit. This information has make, model, and amount of credit it qualifies for. You as the buyer can rely on the manufacturer's certification and they "should be able to provide you, the buyer with a copy of the IRS letter acknowledging the certification of the vehicle." So I assume Tesla would be sending the IRS the vin numbers as part of their report so I think the date for determining the amount of tax credit available is the date you buy the vehicle. As long as you get your title and put it into service in the same year you bought it you should be ok.

I am not a tax lawyer or cpa but this is my interpretation of the Instructions Form 8936.


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## dudeman (Jun 20, 2017)

garsh said:


> I was thinking that too, but it also states that the vehicle must be "put in service". So that probably means it must be registered with a state so that you can legally drive it on public roads.
> 
> Ref: Instructions for Form 8936


As soon I pay for my car, I am putting into service and driving home using temporary tag if needed 

Talking about putting into service, some people want to drive cross country right after getting the car !!!

We still have almost a year before folks run into this... rules will get clear in time.


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## SoFlaModel3 (Apr 15, 2017)

ModFather said:


> In general, I agree with your assessment. But going back to the "elusive $35K model 3" thread, I think that someone wishing to purchase a $35K standard base model 3 and qualifying for the full $7,500 tax credit (thus making it a $27.5K car) are growing increasing slim. That was my premise in that thread, and I think there are going to be some disappointed reservationists who are hoping to purchase a Tesla for under $30K.


I would say their odds just got better in the sense that hitting 200k in January instead of December adds 3 months of possibility to the elusive $27,500 Tesla as you put it.

I still think it's a stretch and someone banking of S $27,500 Tesla or bust should probably look for other options.


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## KennethK (Oct 13, 2016)

This is why I said you had to title your vehicle in a particular quarter to get the respective tax credit:

From the document:
https://www.irs.gov/irb/2009-48_IRB/ar09.html

A vehicle is not "acquired" before the date on which title to that vehicle passes under state law.

Now the SALE of the vehicle in a particular quarter represents the #200,000 mark.

(These are my understandings from reading that document above)


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## KennethK (Oct 13, 2016)

Check out this thread for the number of vehicles sold in the US

2017 projected output


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## Cloxxki (Jun 30, 2017)

Why so much focus on the US tax incenttive? Aren't incentives around the world diminishing? Ask Denmark.


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## Routybouty (Jan 4, 2017)

Is the 200k considered full-filled when the 200k VIN is created or when the 200k Tesla is registered?


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## KennethK (Oct 13, 2016)

Routybouty said:


> Is the 200k considered full-filled when the 200k VIN is created or when the 200k Tesla is registered?


According to the documents above, when it is sold in the US.


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## ModFather (Apr 3, 2016)

Cloxxki said:


> Why so much focus on the US tax incenttive? Aren't incentives around the world diminishing? Ask Denmark.


Yes, the tax credit is being gradually phased out in the US when an auto manufacturer registers 200K EV sales. Tesla is getting very close to that number and most people want to take advantage of that incentive while it is still available. Who would want to walk away from "free" money, especially if it comes from the government?


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## ModFather (Apr 3, 2016)

Routybouty said:


> Is the 200k considered full-filled when the 200k VIN is created or when the 200k Tesla is registered?


When the 200K vehicle is registered in the US. For Tesla, that includes roadster, S, and X registrations too.


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## SoFlaModel3 (Apr 15, 2017)

ModFather said:


> When the 200K vehicle is registered in the US. For Tesla, that includes roadster, S, and X registrations too.


It's definitely when it's sold ... Tesla reports the numbers to the government.


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## KennethK (Oct 13, 2016)

ModFather said:


> When the 200K vehicle is registered in the US. For Tesla, that includes roadster, S, and X registrations too.


That is not correct. See the documents above.


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## Cloxxki (Jun 30, 2017)

ModFather said:


> Yes, the tax credit is being gradually phased out in the US when an auto manufacturer registers 200K EV sales. Tesla is getting very close to that number and most people want to take advantage of that incentive while it is still available. Who would want to walk away from "free" money, especially if it comes from the government?


My point is, Tesla is a global brand, more countries have incentives going on, and getting Model 3 a year later will definitely affect some of those owners.


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## dudeman (Jun 20, 2017)

Cloxxki said:


> My point is, Tesla is a global brand, more countries have incentives going on, and getting Model 3 a year later will definitely affect some of those owners.


I agree with you @Cloxxki

May be because some of us are self centered. We should think globally.


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## garsh (Apr 4, 2016)

Cloxxki said:


> Why so much focus on the US tax incenttive?


I would guess it's due to a combination of:

The US is Tesla's largest market
The US Federal incentive is scheduled to run out (for Tesla) during the production ramp-up of the Model 3.
When it runs out, it's date-based. The more cars you can sell in that time frame, the more people that qualify for the rebate.



> Ask Denmark.


Right before Denmark removed their EV incentives, Tesla was concentrating on selling as many Model S in that country as they could. They started shipping extra vehicles to the country even before it had an order (reference). This was back when Teslas were all custom-ordered, long before they started making some standard configurations to have at stores for people to buy & drive. So Tesla _does_ have a history of concentrating on whatever incentive is scheduled to run out at the time.


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## ModFather (Apr 3, 2016)

KennethK said:


> That is not correct. See the documents above.


What is not correct? Help me out here.


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## ModFather (Apr 3, 2016)

Cloxxki said:


> My point is, Tesla is a global brand, more countries have incentives going on, and getting Model 3 a year later will definitely affect some of those owners.


Okay, now I understand. So, what is your solution? How should Tesla distribute their model 3? Should the reservationists in those countries whose incentives are expiring soonest get their cars first? Interesting discussion.


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## dudeman (Jun 20, 2017)

ModFather said:


> Okay, now I understand. So, what is your solution? How should Tesla distribute their model 3? Should the reservationists in those countries whose incentives are expiring soonest get their cars first? Interesting discussion.


Ideally, It should be first come first serve. But business and practicality dictates otherwise.

I hope folks outside of US understand that tesla needs to be profitable and that means they need to deliver as many cars as they can during full incentive period in US. Tesla does care about all customers, it's just that they are in bind to serve US customers first this time around.


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## KennethK (Oct 13, 2016)

ModFather said:


> What is not correct? Help me out here.


The answer is in posts 115 and 117.


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## SoFlaModel3 (Apr 15, 2017)

ModFather said:


> What is not correct? Help me out here.


200,000 hits when Tesla sells their 200,000th US based car. It is not based upon those cars subsequently being registered.

Tesla reports to the government on their US sales which sets the phase out period in motion.


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## ModFather (Apr 3, 2016)

dudeman said:


> May be because some of us are self centered. We should think globally.


Dude, you bring up an excellent point and honestly a twist I had not considered. That's what is so great about this Forum, although dominated by North Americans, we have a nice representation from other areas of the world that bring an interesting perspective to the conversation. It is so much better than that "disagree" button. I hope that @Michael Russo will move this discussion to a new thread because it is worthy of serious consideration.

So let me put down some initial thoughts and discussion points:
- how would Tesla address service issues of a brand new model in a country without a well developed Tesla service infrastructure
- what are all the various EV incentives in all countries that provide them
- whereas the US tax credit incentives are number based, there are obviously EV incentives in countries that are time based
- should model 3 inventory priority go to countries with the worst pollution problem or to countries that provide the highest incentives
- how should Tesla address the issue without getting involved in the internal politics and policies of sovereign nations, especially the US

Okay, that's a start. Anyone else want to join in with their perspective and discussion points?


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## Topher (May 11, 2016)

ModFather said:


> Do you think he makes enough money to take advantage of the $7,500 Fed, tax credit and the $2,500 Ca tax credit?


He is paid minimum wage for his work at Tesla. But he does have a second job to be able to feed those 5 boys of his. No idea what his tax situation is.



ModFather said:


> EM would not want to take away a tax credit from some poor schmuck like me!


Nor can he, by buying a car. The tax credits are limited ultimately by time. The key to you getting a tax credit is production ramp up speed.

Thank you kindly.


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## ModFather (Apr 3, 2016)

SoFlaModel3 said:


> 200,000 hits when Tesla sells their 200,000th US based car. It is not based upon those cars subsequently being registered.
> 
> Tesla reports to the government on their US sales which sets the phase out period in motion.


Hummmm. my understanding is that in Ca when title is transferred the car has to be registered. You can put that car on non-op status which avoids annual licensing fees, - which I have done with some of my street rods - but then you cannot drive them on the street either. Maybe it works different in other States.


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## SoFlaModel3 (Apr 15, 2017)

ModFather said:


> Hummmm. my understanding is that in Ca when title is transferred the car has to be registered. You can put that car on non-op status which avoids annual licensing fees, - which I have done with some of my street rods - but then you cannot drive them on the street either. Maybe it works different in other States.


No you're right. We're probably saying the same thing. Ultimately that means the car is sold.


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## ModFather (Apr 3, 2016)

KennethK said:


> Remember that in order for you to qualify for the credit, it is based on the day you register your vehicle with the DMV and that can take a long time... order vehicle, wait for it to be built, wait for it to be transported, wait for it to be delivered to you, wait for the paperwork to register it with the DMV.


In Ca it works this way, you give them the money for the car which includes licensing and registration, your new vehicle is now licensed AND registered with the State the day you pay for it and drive off the lot, they give you the keys to the car and temporary licensing and registration paperwork. Dealer scotch tapes the receipt for the licensing and registration fees on the interior lower right of the windshield to let LE know that you are legal. Then you wait a period of time to get your plates, registration, and pink slip (unless it is financed) from the DMV. It may work different in other States, I don't know.


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## ModFather (Apr 3, 2016)

SoFlaModel3 said:


> No you're right. We're probably saying the same thing. Ultimately that means the car is sold.


So I still don't understand what I said was incorrect.


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## SoFlaModel3 (Apr 15, 2017)

ModFather said:


> So I still don't understand what I said was incorrect.


I think my point was that your car is temporarily registered at point of sale. The DMV doesn't actually know about this car yet. I believe it's still point of sale and not when the DMV knows about the car and who owns it.


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## SoFlaModel3 (Apr 15, 2017)

@ModFather -- I did my homework. Here is the URL for you, but I'll paraphrase the import part(s) below.

The link: https://www.irs.gov/irb/2009-48_IRB/ar09.html

See below, it's Tesla reporting to the government on it's sales. The car becoming registered has no bearing whatsoever. 
Should you the buyer decide to take the car out of the country, remove it from service, resell it, etc.; you personally would forego the credit. However, your car still counts toward the 200,000 needed to reach the phase out period.

.05 _Quarterly Reporting of Sales of Qualified Vehicles_. A manufacturer (or, in the case of a foreign vehicle manufacturer, its domestic distributor) that has received an acknowledgment of its certification from the Service must submit to the Service, in accordance with section 6 of this notice, a report of the number of qualified plug-in electric drive motor vehicles sold by the manufacturer (or, in the case of a foreign vehicle manufacturer, its domestic distributor) to consumers or retail dealers during the calendar quarter. The quarterly report must contain the following:
(1) The name, address, and taxpayer identification number of the reporting entity.
(2) The number of qualified vehicles sold by the reporting entity to consumers or retail dealers during the calendar quarter.
(3) The make, model, model year, and any other appropriate identifiers of the qualified vehicles sold during the calendar quarter.
(4) A declaration, applicable to the quarterly report and any accompanying documents, signed by a person currently authorized to bind the manufacturer (or, in the case of a foreign vehicle manufacturer, its domestic distributor) in these matters, in the following form: "Under penalties of perjury, I declare that I have examined this report, including accompanying documents, and to the best of my knowledge and belief, the facts presented in support of this report are true, correct, and complete."
.06 _Acknowledgment of Quarterly Report_. The Service will review the original signed quarterly report and issue an acknowledgment letter to the vehicle manufacturer (or, in the case of a foreign vehicle manufacturer, its domestic distributor) within 30 days of receipt of the report. This acknowledgment letter will state whether purchasers may continue to rely on the certification.​


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## ModFather (Apr 3, 2016)

SoFlaModel3 said:


> I think my point was that your car is temporarily registered at point of sale. The DMV doesn't actually know about this car yet. I believe it's still point of sale and not when the DMV knows about the car and who owns it.


In Ca it is simultaneous. When the dealer accepts your fees and entered into the computer, your car is now legally registered. The dealer puts a slip of paper on the windshield to prove to LE that it is in fact registered. It is illegal to operate a non-registered vehicle (from any State) on a Ca public roadway.


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## SoFlaModel3 (Apr 15, 2017)

ModFather said:


> In Ca it is simultaneous. When the dealer accepts your fees and entered into the computer, your car is now registered.


Right, but read up one post. It's the sale, not the registration that matters. In California as you said it's simultaneous. I assume it's the same in Florida, honestly not sure. Obviously also not sure about the other 48, but it's irrevelant. What matters is once the car leaves Tesla's possession it's "sold".


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## ModFather (Apr 3, 2016)

SoFlaModel3 said:


> Right, but read up one post. It's the sale, not the registration that matters. In California as you said it's simultaneous. I assume it's the same in Florida, honestly not sure. Obviously also not sure about the other 48, but it's irrevelant. What matters is once the car leaves Tesla's possession it's "sold".


@SoFlaModel3 I'm giving you the disagree yellow card. I could pull into the Tesla showroom and put my model 3 on the back of a flatbed and drive off without ever registering it. The tax credit regulation says, "put in use". In Ca you can purchase all the cars you want but they can't be "put in use" until they are registered. It seems silly to debate a point of semantics especially when @KennethK throws out the "incorrect" grenade and refuses to back it up.


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## KennethK (Oct 13, 2016)

ModFather said:


> @SoFlaModel3 I'm giving you the disagree yellow card. I could pull into the Tesla showroom and put my model 3 on the back of a flatbed and drive off without ever registering it. The tax credit regulation says, "put in use". In Ca you can purchase all the cars you want but they can't be "put in use" until they are registered. It seems silly to debate a point of semantics especially when @KennethK throws out the "incorrect" grenade and refuses to back it up.


I did back it up in the posts referenced. Just re-read those.

and this one:



KennethK said:


> This is why I said you had to title your vehicle in a particular quarter to get the respective tax credit:
> 
> From the document:
> https://www.irs.gov/irb/2009-48_IRB/ar09.html
> ...


You can always read the documents that I linked to.


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## SoFlaModel3 (Apr 15, 2017)

ModFather said:


> @SoFlaModel3 I'm giving you the disagree yellow card. I could pull into the Tesla showroom and put my model 3 on the back of a flatbed and drive off without ever registering it. The tax credit regulation says, "put in use". In Ca you can purchase all the cars you want but they can't be "put in use" until they are registered. It seems silly to debate a point of semantics especially when @KennethK throws out the "incorrect" grenade and refuses to back it up.


No see that's where you're wrong!! 

Your car counts toward the 200,000 from "Tesla", but for your tax purposes you cannot claim the credit because the car was not put into use.

That's the point I was trying to make.


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## KennethK (Oct 13, 2016)

@SoFlaModel3 , we agree, as in all the previous posts. There are 2 separate things happening. The government has a starting point for the 200,000th vehicle SOLD in the US when the phase out is based upon. The IRS has a different set of rules (the other document) that details how to get the tax credit based on being registered.

That is what I was saying back on this post:



KennethK said:


> This is why I said you had to title your vehicle in a particular quarter to get the respective tax credit:
> 
> From the document:
> https://www.irs.gov/irb/2009-48_IRB/ar09.html
> ...


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## ModFather (Apr 3, 2016)

SoFlaModel3 said:


> Right, but read up one post. It's the sale, not the registration that matters............What matters is once the car leaves Tesla's possession it's "sold".


Yes, it is sold but not necessarily "placed in service." I could purchase a model 3, load it onto a flatbed and park it my garage for the next 25 years. Never register it. I could then sell it at the Barrett Jackson Auto Auction as a non-registered, zero miles original (as some people do with other cars) and make a potential fortune. I would not qualify for the tax credit because the car was never "placed in service" and therefore would not count against the threshold.


KennethK said:


> I did back it up in the posts referenced. Just re-read those.
> and this one:
> You can always read the documents that I linked to.


I did read those documents as well as this one, IRS form 8936. In part it says:
_Use Form 8936 to figure your credit for qualified plug-in electric drive motor vehicles you placed in service during your tax year.
_

_The following requirements must be met to qualify for the credit.

_

_You are the owner of the vehicle. If the vehicle is leased, only the lessor and not the lessee, is entitled to the credit._
_You placed the vehicle in service during your tax year._
_The vehicle is manufactured primarily for use on public streets, roads, and highways._
_The original use of the vehicle began with you._
_You acquired the vehicle for use or to lease to others, and not for resale._
_You use the vehicle primarily in the United States._
I submit that a vehicle is not "placed in service" until it is registered. In Ca a vehicle is sold, title transferred, and registered simultaneously, most of the time. I believe the government assumes the same thing. However, the government goes on to say the vehicle must be "placed in service" to qualify for the tax credit. That means registered. So that is what really triggers the EV threshold. But what good does it do to debate semantics. It is very rare when a vehicle is not sold, title transferred, and registered all at the same time and that is what is reported to the government.


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## SoFlaModel3 (Apr 15, 2017)

ModFather said:


> Yes, it is sold but not necessarily "placed in service." I could purchase a model 3, load it onto a flatbed and park it my garage for the next 25 years. Never register it. I could then sell it at the Barrett Jackson Auto Auction as a non-registered, zero miles original (as some people do with other cars) and make a potential fortune. I would not qualify for the tax credit because the car was never "placed in service" and therefore would not count against the threshold.
> 
> I did read those documents as well as this one, IRS form 8936. In part it says:
> _Use Form 8936 to figure your credit for qualified plug-in electric drive motor vehicles you placed in service during your tax year.
> ...


You are misinterpreting this tax credit.

There are 2 aspects to it.

The car and the individual.

When the car is "sold" it counts against the threshold of 200,000. Tesla reports that sale to the IRS. They have no idea what you will do with the car from there.

If you're ineligible to collect the credit for whatever reason and there are a few: you resell the car, you don't put the car in service, you don't use the car in the US the majority of the time, you don't have enough taxable income, etc. That simply means you personally do not get the credit, but the car still counted against the threshold.


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## JWardell (May 9, 2016)

I stopped in the Tesla Store this weekend, and the staff are still anti-selling the 3 and said I definitely will NOT get the tax credit by the time my 3 is delivered, I should instead buy a floor model S. (Of course I don't believe that)

But it does bring up a question that I haven't seen addressed: If I were to buy a used S, I assume I don't get any tax credit, correct? (This is why they mentioned floor model with its slightly reduced but never pre-owned price) Also, can you only get a tax credit once? As in, if I were to buy a different EV as well as the three, could I get the credit twice? (The Tesla salesman did suggest buying each under different names of me and my wife, though we would probably then have to do taxes separately)


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## dudeman (Jun 20, 2017)

JWardell said:


> I stopped in the Tesla Store this weekend, and the staff are still anti-selling the 3 and said I definitely will NOT get the tax credit by the time my 3 is delivered, I should instead buy a floor model S. (Of course I don't believe that)
> 
> But it does bring up a question that I haven't seen addressed: If I were to buy a used S, I assume I don't get any tax credit, correct? (This is why they mentioned floor model with its slightly reduced but never pre-owned price) Also, can you only get a tax credit once? As in, if I were to buy a different EV as well as the three, could I get the credit twice? (The Tesla salesman did suggest buying each under different names of me and my wife, though we would probably then have to do taxes separately)


Wondering how much discount offered on floor Model.


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## SoFlaModel3 (Apr 15, 2017)

JWardell said:


> I stopped in the Tesla Store this weekend, and the staff are still anti-selling the 3 and said I definitely will NOT get the tax credit by the time my 3 is delivered, I should instead buy a floor model S. (Of course I don't believe that)
> 
> But it does bring up a question that I haven't seen addressed: If I were to buy a used S, I assume I don't get any tax credit, correct? (This is why they mentioned floor model with its slightly reduced but never pre-owned price) Also, can you only get a tax credit once? As in, if I were to buy a different EV as well as the three, could I get the credit twice? (The Tesla salesman did suggest buying each under different names of me and my wife, though we would probably then have to do taxes separately)


Credit is only on new car sales, so a car that has already been titled will not qualify.



dudeman said:


> Wondering how much discount offered on floor Model.


It's negotiable.

See this post in another thread showing the credit my dad got on his inventory S back in December.

$7,400 off an $85,000 MSRP

When do we actually "buy" our Model 3's?


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## JWardell (May 9, 2016)

dudeman said:


> Wondering how much discount offered on floor Model.


Not sure, but no matter what it won't be in my $35k price range no matter how much rebate it gets. 
He did mention though that they replace the floor cars every two weeks, so they are fairly available.


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## SoFlaModel3 (Apr 15, 2017)

JWardell said:


> Not sure, but no matter what it won't be in my $35k price range no matter how much rebate it gets.
> He did mention though that they replace the floor cars every two weeks, so they are fairly available.


With the new focus on used cars, you're not going to find an inventory car dip that far.

I, like many, took a quick look at the used cars that flooded the Tesla site but I can't spend $50k on a 3-4 year old car with old tech.


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## JWardell (May 9, 2016)

@SoFlaModel3 he did mention that they have many more cars than those listed on the web site, and in fact have warehouses full thanks to many ended leases and AWD upgraders. The sales staff can only access the full database. Worth a visit or phone call to ask them to contact you when one becomes available at a lower price.


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## garsh (Apr 4, 2016)

JWardell said:


> Also, can you only get a tax credit once? As in, if I were to buy a different EV as well as the three, could I get the credit twice?


You can get it more than once.
In fact, if you take a look at the form, you'll see that it has space for two vehicles to be entered.

But remember, this just reduces your tax liability. If you don't pay at least $15,000/yr in federal taxes, then you won't get the full credit amount for two vehicles.


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## SoFlaModel3 (Apr 15, 2017)

JWardell said:


> @SoFlaModel3 he did mention that they have many more cars than those listed on the web site, and in fact have warehouses full thanks to many ended leases and AWD upgraders. The sales staff can only access the full database. Worth a visit or phone call to ask them to contact you when one becomes available at a lower price.


To be honest I am not a fan of used cars in general. I like the S a lot, but I would want the latest tech, latest body styling (the new nose cone is so much nicer IMHO), and you simply can't get that used.

I'll take my brand new Model 3 75 over a used Model S 60 with barely any options any day of the week.

Just a little more waiting to go!


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## Ninja (Jun 25, 2017)

I was at the my local Tesla 'dealership' to ask the employees if they have received any new news about the Model 3 that the general public has not gotten yet. Sadly, they know as much about the Model 3 as we do (doubting that).

When I ask the Tesla employee when I should get my Model 3, he said I would recieve it late summer/early fall of 2018 for a 75D. I preordered the car on 3/31/16 at 3:00PM.

When I showed him Teslanomics delivery estimator, he was very mad and said, "It is all speculation, [Teslanomics] has no evidence to support his claims. Its a fraud." I was very suprised with the Tesla employees remark.

Anyways, he mentioned the fedreal tax credit. He said that I would revieve *NO* tax credit, even though I was a first day preorderie. Does this sound right? After he made all these comments, he told me to buy a used Tesla Model S, and how it will be better than a new Model 3.

I do not believe he knows how the Tax credit works, is he correct on what he told me, or what?


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## KennethK (Oct 13, 2016)

Kriffic said:


> I was at the my local Tesla 'dealership' to ask the employees if they have received any new news about the Model 3 that the general public has not gotten yet. Sadly, they know as much about the Model 3 as we do (doubting that).
> 
> When I ask the Tesla employee when I should get my Model 3, he said I would recieve it late summer-fall of 2018 for a 75D! I preordered the car on 3/31/16 at 3:00PM.
> 
> ...


That employee seams to be very pessimistic. We as fan boys are rather optimistic. Let's meet in the middle! 

You and I are buying the same vehicle (75D) and are in the mid west and reserved about the same time. It is my guess that we will see the full credit (at least $3750) and late Q1, early Q2. He is just antiselling model 3.


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## SoFlaModel3 (Apr 15, 2017)

Kriffic said:


> I was at the my local Tesla 'dealership' to ask the employees if they have received any new news about the Model 3 that the general public has not gotten yet. Sadly, they know as much about the Model 3 as we do (doubting that).
> 
> When I ask the Tesla employee when I should get my Model 3, he said I would recieve it late summer/early fall of 2018 for a 75D. I preordered the car on 3/31/16 at 3:00PM.
> 
> ...


I agree with his comments on Teslanomics, just not the tone or the way he said it. It's a guess. Nothing more and nothing less. It's unofficial and no one has any reason to believe it's an accurate depiction of what will actually happen.

Now to part 2 ... well if the salesman says you're getting your car in summer/fall 2018 and subsequently not getting the tax credit then they simply do not understand the credit.

If Tesla hits car 200,000 in the US on July 1, 2017 (note that's in the past and we would have already heard if that was the case), then...

$7,500 runs through 12/31/2017
$3,750 runs 1/1/2018-6/30/2018
$1,875 runs 7/1/2018-12/31/2018

So clearly we are now confirmed that anyone getting a Tesla in 2018 gets a car that qualifies for some level of the credit.

Now if car 200,000 hits in Q4 that extends to 3/31/2019 and if car 200,000 hits in Q1 2018 that extends out to 6/30/2019.

So yeah...


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## MelindaV (Apr 2, 2016)

Kriffic said:


> Anyways, he mentioned the fedreal tax credit. He said that I would revieve *NO* tax credit, even though I was a first day preorderie. Does this sound right? After he made all these comments, he told me to buy a used Tesla Model S, and how it will be better than a new Model 3.



you would certainly not get any credit on a used Model S! hope you pointed that out to him.


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## JWardell (May 9, 2016)

Kriffic said:


> ...
> Anyways, he mentioned the fedreal tax credit. He said that I would revieve *NO* tax credit, even though I was a first day preorderie. Does this sound right? After he made all these comments, he told me to buy a used Tesla Model S, and how it will be better than a new Model 3.
> 
> I do not believe he knows how the Tax credit works, is he correct on what he told me, or what?


That's almost exactly what the Tesla salesman told me too. And I have read it elsewhere. It is glaringly obvious they are trained to say this in order to shift demand to model S. Tesla would have to fail miserably with the 3 production ramp for this to be true.


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## Winemaker01 (Dec 30, 2016)

Australia was the first place that took orders and I was one of the first on the 31st local time, 30th US time. The article in todays newspaper suggests I may not get my Model 3 until 2019!!! In Australia our deposit was Aust$1500. That is not me, I am David the winemaker in Red Hill, Victoria Aust 3937!!


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## Michael Russo (Oct 15, 2016)

Winemaker01 said:


> Australia was the first place that took orders and I was one of the first on the 31st local time, 30th US time. The article in todays newspaper suggests I may not get my Model 3 until 2019!!! In Australia our deposit was Aust$1500. That is not me, I am David the winemaker in Red Hill, Victoria Aust 3937!!
> View attachment 2202


David, I understand your impatience. I reserved too late, 6 months after the reveal, and, being in Europe, I am not counting on a delivery before late 1Q19 either.

Yet, in your case, you need a RHD car just like UK, Eire, India and a few others around the world; that it is most likely the main reason for this long wait time. It is my recollection that T≡SLA was going to deliver RHD cars somewhat later even than EU LHD cars...

Stay focused on the prize: a wonderful Model 3, in the color of your choice, with most likely more options to choose from, in YOUR driveway... at some point in the near future...

Time flies...


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## jtdiddy (Jun 12, 2017)

SoFlaModel3 said:


> I agree with his comments on Teslanomics, just not the tone or the way he said it. It's a guess. Nothing more and nothing less. It's unofficial and no one has any reason to believe it's an accurate depiction of what will actually happen.
> 
> Now to part 2 ... well if the salesman says you're getting your car in summer/fall 2018 and subsequently not getting the tax credit then they simply do not understand the credit.
> 
> ...


Nice summary. What is the current projection that Tesla will hit the 200k mark? I was hearing projections on either Dec or Jan.


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## SoFlaModel3 (Apr 15, 2017)

jtdiddy said:


> Nice summary. What is the current projection that Tesla will hit the 200k mark? I was hearing projections on either Dec or Jan.


Without a doubt we're looking at Q4 of this year or Q1 of next year.

Most everyone hopes it's Q1 of next year and I'm expecting it to be Q4 of this year.


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## jtdiddy (Jun 12, 2017)

SoFlaModel3 said:


> Without a doubt we're looking at Q4 of this year or Q1 of next year.
> 
> Most everyone hopes it's Q1 of next year and I'm expecting it to be Q4 of this year.


Ok if so, anyone receiving their cars by May or June 2018 should still qualify for the full fed credit.


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## rjhoskins (Apr 9, 2017)

From what I've searched: If Tesla reaches the 200k in December 2017, in order to receive the full tax credit of $7500, delivery must be made by 3/31/2018.
If Tesla reaches the 200k mark in January 2018, delivery must be made by 6/30/2018.
Everyone agree?


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## KennethK (Oct 13, 2016)

rjhoskins said:


> From what I've searched: If Tesla reaches the 200k in December 2017, in order to receive the full tax credit of $7500, delivery must be made by 3/31/2018.
> If Tesla reaches the 200k mark in January 2018, delivery must be made by 6/30/2018.
> Everyone agree?


Please see this post an subsequent ones.

https://teslaownersonline.com/threads/federal-tax-credit.2317/page-6#post-30389


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## SoFlaModel3 (Apr 15, 2017)

rjhoskins said:


> From what I've searched: If Tesla reaches the 200k in December 2017, in order to receive the full tax credit of $7500, delivery must be made by 3/31/2018.
> If Tesla reaches the 200k mark in January 2018, delivery must be made by 6/30/2018.
> Everyone agree?


Yes!

After they hit 200,000 cars the $7,500 credit is in effect for the remainder of that quarter and the entire next quarter before cutting in half to $3,750.


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## jtdiddy (Jun 12, 2017)

rjhoskins said:


> From what I've searched: If Tesla reaches the 200k in December 2017, in order to receive the full tax credit of $7500, delivery must be made by 3/31/2018.
> If Tesla reaches the 200k mark in January 2018, delivery must be made by 6/30/2018.
> Everyone agree?


Awesome, thx for clarifying. This makes me nervous if they hit the limit in Dec because delivery date on the standard battery is between Jan and March. Now I'm thinking of whether to upgrade to the longer range version to ensure i get the 3 earlier to ensure I qualify for the full tax credit.


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## SoFlaModel3 (Apr 15, 2017)

jtdiddy said:


> Awesome, thx for clarifying. This makes me nervous if they hit the limit in Dec because delivery date on the standard battery is between Jan and March. Now I'm thinking of whether to upgrade to the longer range version to ensure i get the 3 earlier to ensure I qualify for the full tax credit.


I was pretty sure they would hit 200,000 in Q4, but my new estimate is early Q1. I suspect they'll have a lot of undelivered cars in transit when 2017 comes to an end. Assuming that's the case, a lot of people are going to get the $7,500 credit.


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## tivoboy (Mar 24, 2017)

I don’t think we’ll hot 200k till q1 2018. Actually I think Tesla is engineering it that way. Then everyone in q1 AND q2 will get the 7500$ tax credit applied.

In theory based on this hypothesis, Tesla and new owners could get the full 7500$ tax credits up to nearly ~320,000 vehicles.. I would think that Tesla would be indifferent to some "sales" moving into Q118 in order to provide new buyers the access to the 7500$ for an additional 60,000+ vehicles.


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## tivoboy (Mar 24, 2017)

KennethK said:


> Remember that in order for you to qualify for the credit, it is based on the day you register your vehicle with the DMV and that can take a long time... order vehicle, wait for it to be built, wait for it to be transported, wait for it to be delivered to you, wait for the paperwork to register it with the DMV.


I would have thought that the titling, would the official sale and registration of the vehicle. It must be somehow "registered" to the buyer as insurance is required, by VIN for THAT vehicle the minute one drives it away from the dealer after sale. I can't imagine that one is going to be dependent on the DMV to finalize registration for the "registered" element to kick in and an official federal tax credit to be available?


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## Model34mePlease (Jun 3, 2017)

I haven't seen this commented on.

Folks have talked about shipments out of the country to control when the 200,000th Model 3 ships to maximize how much tax credit is available to customers. However, it seems that everyone out of the country is seeing shipment predictions of at-least late 2018. That must mean either Tesla thinks the normal production ramp will allow this optimization, or Tesla isn't really paying attention to this issue.


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## KennethK (Oct 13, 2016)

tivoboy said:


> I would have thought that the titling, would the official sale and registration of the vehicle. It must be somehow "registered" to the buyer as insurance is required, by VIN for THAT vehicle the minute one drives it away from the dealer after sale. I can't imagine that one is going to be dependent on the DMV to finalize registration for the "registered" element to kick in and an official federal tax credit to be available?


I can only speak about Michigan. When I pick up my vehicle in Ohio ( because you know why) I have to wait about 3 weeks for the paperwork to come from Tesla to then take to the DMV, then the vehicle is registered. Hopefully Tesla is faster than my experience with BMW. The documents referenced earlier in this thread tell about how it works with the IRS.


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## ModFather (Apr 3, 2016)

tivoboy said:


> I would have thought that the titling, would the official sale and registration of the vehicle. It must be somehow "registered" to the buyer as insurance is required, by VIN for THAT vehicle the minute one drives it away from the dealer after sale. I can't imagine that one is going to be dependent on the DMV to finalize registration for the "registered" element to kick in and an official federal tax credit to be available?


TB you are correct. The day you sign the papers with the showroom, your car is officially titled, registered, and licensed by the State of California. The dealer will give you temporary paperwork. The DMV may take awhile to get you the final paperwork but that has nothing to do with the actual sale, registration and license of the car. The Federal tally for 200K EV cars is based on this collective transaction. Your potential tax credit will be based on the tax year you took possession.


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## ModFather (Apr 3, 2016)

KennethK said:


> I can only speak about Michigan. When I pick up my vehicle in Ohio ( because you know why) I have to wait about 3 weeks for the paperwork to come from Tesla to then take to the DMV, then the vehicle is registered. Hopefully Tesla is faster than my experience with BMW. The documents referenced earlier in this thread tell about how it works with the IRS.


If you take possession of the car in Ohio, then I presume it is registered immediately in Ohio, otherwise how can you drive it on any public roads? Yes, if you want to transfer title from Ohio to Michigan after the fact, that can understandably take a while


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## ModFather (Apr 3, 2016)

KennethK said:


> I can only speak about Michigan. When I pick up my vehicle in Ohio ( because you know why) I have to wait about 3 weeks for the paperwork to come from Tesla to then take to the DMV, then the vehicle is registered. Hopefully Tesla is faster than my experience with BMW. The documents referenced earlier in this thread tell about how it works with the IRS.


If you take possession of the car in Ohio, then I presume it is registered immediately in Ohio, otherwise how can you drive it on any public roads? Yes, if you want to transfer title from Ohio to Michigan after the fact, that can understandably take a while


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## garsh (Apr 4, 2016)

Model34mePlease said:


> I haven't seen this commented on.
> 
> Folks have talked about shipments out of the country to control when the 200,000th Model 3 ships to maximize how much tax credit is available to customers. However, it seems that everyone out of the country is seeing shipment predictions of at-least late 2018. That must mean either Tesla thinks the normal production ramp will allow this optimization, or Tesla isn't really paying attention to this issue.


It's because they realize that production ramp up is MUCH MORE IMPORTANT than the date on which they reach 200k.

See this post for details.


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## KennethK (Oct 13, 2016)

ModFather said:


> If you take possession of the car in Ohio, then I presume it is registered immediately in Ohio, otherwise how can you drive it on any public roads? Yes, if you want to transfer title from Ohio to Michigan after the fact, that can understandably take a while


That is a good question. I only get a temporary "plate", the paper thing you put in the window, from Ohio. Maybe it is "registered", but it definitely is sold. The time difference (3 weeks or so) only comes into play if it straddles a quarter where the federal tax credit amount changes from one dollar amount to another. I guess I'll worry about that when it comes down to it


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## SoFlaModel3 (Apr 15, 2017)

Model34mePlease said:


> I haven't seen this commented on.
> 
> Folks have talked about shipments out of the country to control when the 200,000th Model 3 ships to maximize how much tax credit is available to customers. However, it seems that everyone out of the country is seeing shipment predictions of at-least late 2018. That must mean either Tesla thinks the normal production ramp will allow this optimization, or Tesla isn't really paying attention to this issue.


This is another one of those topics that becomes highly speculative and leads to disappointment. Don't assume Tesla is going to delay anything to manipulate where 200,000 falls. Also, don't assume they're going to ship outside of the US until they work the substantive backlog in home base.

Right now it looks like 200,000 is going to hit in Q4 2017 or Q1 2018. I kept assuming Q4 2017, but my most recent "guess" is that there will be a lot of cars in transit that are not yet delivered as 2017 comes to a close and car 200,000 falls in very early 2018. With that in mind, the credit phase out will be in motion.

Elon Musk said Tesla would "do the right thing". I think people assume that means they would stall 200,000 to extend things, but another way to look at it is that they're doing the right thing by focusing on US bound cars to maximize how many people get some share of the tax credit as it phases out.

It's best to simply see how it plays out, but I wouldn't make any assumptions here as we simply do not know anything beyond what the estimator is telling us and that could change in a moment's notice.


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## Model34mePlease (Jun 3, 2017)

SoFlaModel3 said:


> This is another one of those topics that becomes highly speculative and leads to disappointment. Don't assume Tesla is going to delay anything to manipulate where 200,000 falls. Also, don't assume they're going to ship outside of the US until they work the substantive backlog in home base.
> 
> Right now it looks like 200,000 is going to hit in Q4 2017 or Q1 2018. I kept assuming Q4 2017, but my most recent "guess" is that there will be a lot of cars in transit that are not yet delivered as 2017 comes to a close and car 200,000 falls in very early 2018. With that in mind, the credit phase out will be in motion.
> 
> ...


It's not a question of stalling anything. Tesla could choose to position where 200,000 falls, if that is necessary, by shipping a few to Canada. That doesn't seem to be in their plans. This is not a complaint, just a comment.


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## SoFlaModel3 (Apr 15, 2017)

Model34mePlease said:


> It's not a question of stalling anything. Tesla could choose to position where 200,000 falls, if that is necessary, by shipping a few to Canada. That doesn't seem to be in their plans. This is not a complaint, just a comment.


I never said it was a complaint. More so just pointing out the rationale behind the delivery schedule and suggesting that the notion of sending cars elsewhere to delay 200,000 is another HUD in the making.


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## Cjros (Aug 1, 2017)

Not sure what everyone else is seeing on reservation tracker, but in Ohio it looks like I will only get 50% if I choose the standard battery option. That other 50% is left dangling over my head if and only if I choose the first run option or the unlikely event that a great deal of people choose the AWD version. Didn't plan on making this decision until now. The schedule seems almost intentional at this point.


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## Brokedoc (May 28, 2017)

Tesla's next quarterly earnings report will be on Wed 8/2/17 for the quarter ending Jun. We may get an indication on where the US deliveries stand at that time but IIRC, it's very hard to tease apart the domestic from international sales. I expect a major gap in MS/MX deliveries for 3rd quarter due to the major motor upgrade recently announced. I bought my MX 2 weeks before they announced the 25% performance improvement! Unless there are major discounts, I think they now have a bunch of older spec cars that will end up in the loaner pool and possibly pushing the 200k mark past Jan 1 2018.


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## Model34mePlease (Jun 3, 2017)

Brokedoc said:


> Tesla's next quarterly earnings report will be on Wed 8/2/17 for the quarter ending Jun. We may get an indication on where the US deliveries stand at that time but IIRC, it's very hard to tease apart the domestic from international sales. I expect a major gap in MS/MX deliveries for 3rd quarter due to the major motor upgrade recently announced. I bought my MX 2 weeks before they announced the 25% performance improvement! Unless there are major discounts, I think they now have a bunch of older spec cars that will end up in the loaner pool and possibly pushing the 200k mark past Jan 1 2018.


The MS/MX ship numbers will probably be relatively small compared to the M3 numbers, even just by year-end.


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## SoFlaModel3 (Apr 15, 2017)

Cjros said:


> Not sure what everyone else is seeing on reservation tracker, but in Ohio it looks like I will only get 50% if I choose the standard battery option. That other 50% is left dangling over my head if and only if I choose the first run option or the unlikely event that a great deal of people choose the AWD version. Didn't plan on making this decision until now. The schedule seems almost intentional at this point.


$7,500 is either going to end 3/31/2018 or best case scenario 6/30/2018. If it lasts past 6/30/2018 the company is in trouble because something has gone horribly wrong.


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## tivoboy (Mar 24, 2017)

Brokedoc said:


> Tesla's next quarterly earnings report will be on Wed 8/2/17 for the quarter ending Jun. We may get an indication on where the US deliveries stand at that time but IIRC, it's very hard to tease apart the domestic from international sales. I expect a major gap in MS/MX deliveries for 3rd quarter due to the major motor upgrade recently announced. I bought my MX 2 weeks before they announced the 25% performance improvement! Unless there are major discounts, I think they now have a bunch of older spec cars that will end up in the loaner pool and possibly pushing the 200k mark past Jan 1 2018.


I think we are going to see a flattening of S and X deliveries (or manufacture) and that could lead to a slightly lower than expected Q3/4 impact to the 200K milestone.


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## Model34mePlease (Jun 3, 2017)

SoFlaModel3 said:


> $7,500 is either going to end 3/31/2018 or best case scenario 6/30/2018. If it lasts past 6/30/2018 the company is in trouble because something has gone horribly wrong.


That's a really good (and a bit scary) point.


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## JWardell (May 9, 2016)

Brokedoc said:


> Tesla's next quarterly earnings report will be on Wed 8/2/17 for the quarter ending Jun. We may get an indication on where the US deliveries stand at that time but IIRC, it's very hard to tease apart the domestic from international sales. I expect a major gap in MS/MX deliveries for 3rd quarter due to the major motor upgrade recently announced. I bought my MX 2 weeks before they announced the 25% performance improvement! Unless there are major discounts, I think they now have a bunch of older spec cars that will end up in the loaner pool and possibly pushing the 200k mark past Jan 1 2018.


Were those performance improvements actual changes in hardware or just software tweaks? They could easily upgrade inventory.


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## Brokedoc (May 28, 2017)

JWardell said:


> Were those performance improvements actual changes in hardware or just software tweaks? They could easily upgrade inventory.


Both hardware and software. Not able to be retrofit. Unknown if there will be future OTA patches for older spec cars for partial performance boost.


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## Brokedoc (May 28, 2017)

I am closely watching the estimated delivery times for new MS/MX orders. Current lead time is about 6 weeks which is close to optimized manufacturing on demand with shipment time. I want to see if Tesla does any fudging to delay US deliveries to push the 200k into the following quarter. Of course, Tesla doesn't want to hurt their bottom line but if they can shift production to overseas sales for a few weeks because they're close to 200k US deliveries at the end of a quarter, it would mean that tens if not hundreds of thousand plus more customers could take advantage of the full tax rebate. In that case, we may see US MS/MX lead time stretch a little past 6 weeks towards the end of Sept or end of Dec.

A different manufacturing trick would be to help our Canadian neighbors if Tesla can get regulatory approval for the M3. Tesla could send a few batches north of the border in Nov or December to still sell vehicles but lower the total US delivery count and push 200k into another quarter.

Another factor that I'm watching is the labor situation at Fremont. Elon jokes about entering production hell but the grunts on the line already appear to have some grievances and the UAW is pushing hard to get them to unionize.


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## frozenpenguin (Jul 9, 2016)

SoFlaModel3 said:


> $7,500 is either going to end 3/31/2018 or best case scenario 6/30/2018. If it lasts past 6/30/2018 the company is in trouble because something has gone horribly wrong.


Not necessarily. Remember only US sales count towards the 200,000 mark. They could ship a bunch internationally to extend the time frame somewhat if they wanted.


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## SoFlaModel3 (Apr 15, 2017)

frozenpenguin said:


> Not necessarily. Remember only US sales count towards the 200,000 mark. They could ship a bunch internationally to extend the time frame somewhat if they wanted.


They won't be doing this. They have made it very clear that the focus is on home base for better part of the next 12 months.


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## Model34mePlease (Jun 3, 2017)

All the international delivery dates seem to be for end of 2018. That wouldn't prevent moving S/X orders.


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## Quicksilver (Dec 29, 2016)

I scanned through this post but did not see it so I'll ask (pardon me if it is already answered): How will you know when you take deliver that your car qualifies for the full credit ($7,500)? Will Tesla staff let you know that your VIN qualifies for the full credit? Or, will you find out when you file your taxes (I use an online tax prep system)? I already know that my tax liability will allow me to get the $7,500 if the car qualifies.


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## SoFlaModel3 (Apr 15, 2017)

Quicksilver said:


> I scanned through this post but did not see it so I'll ask (pardon me if it is already answered): How will you know when you take deliver that your car qualifies for the full credit ($7,500)? Will Tesla staff let you know that your VIN qualifies for the full credit? Or, will you find out when you file your taxes (I use an online tax prep system)? I already know that my tax liability will allow me to get the $7,500 if the car qualifies.


Tesla will let you know if "the car" qualifies.

The second part is on you. You must have a tax liability of $7,500 to actually get the full credit.


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## Quicksilver (Dec 29, 2016)

Thanks!


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## Spinball (Jun 20, 2017)

SoFlaModel3 said:


> $7,500 is either going to end 3/31/2018 or best case scenario 6/30/2018. If it lasts past 6/30/2018 the company is in trouble because something has gone horribly wrong.


Isn't this off by a quarter? What makes you think they'll hit 200k delivered in the US this year already? It seems most have been expecting that to occur in Q1 2018.


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## SoFlaModel3 (Apr 15, 2017)

Spinball said:


> Isn't this off by a quarter? What makes you think they'll hit 200k delivered in the US this year already? It seems most have been expecting that to occur in Q1 2018.


It's all speculation.

My belief is that they'll be very close by the end of Q4 and with cars in transit they probably just fall short delivering car 200,000 until early Q1 now.

That would see $7,500 run out to 6/30/2018
$3,750 from 7/1/2018 to 12/31/2018
$1,875 from 1/1/2019 to 6/30/2019
$0 after 6/30/2019

I think it's best to plan for the worst and right now the worst case is hitting 200,000 in Q4 of this year.


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## M3OC Rules (Nov 18, 2016)

SoFlaModel3 said:


> It's all speculation.
> 
> My belief is that they'll be very close by the end of Q4 and with cars in transit they probably just fall short delivering car 200,000 until early Q1 now.
> 
> ...


That seems like the likely scenario which is a bummer for AWD. I'm thinking maybe I should get a cheaper one to get the full $7500 with the smaller battery with my current reservation for my better half. And get another reservation now to get what I want at the end of next year. Anyone know what the delivery estimates are for a reservation made now for AWD in the US?


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## KennethK (Oct 13, 2016)

DC Rules said:


> That seems like the likely scenario which is a bummer for AWD. I'm thinking maybe I should get a cheaper one to get the full $7500 with the smaller battery with my current reservation for my better half. And get another reservation now to get what I want at the end of next year. Anyone know what the delivery estimates are for a reservation made now for AWD in the US?


It is incredible, but current reservations estimate late 2018 delivery for all versions.


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## Model34mePlease (Jun 3, 2017)

KennethK said:


> It is incredible, but current reservations estimate late 2018 delivery for all versions.


At that point they will have produced about 500k Model 3s and have gone through their entire current backlog and you will then be 1st in line.


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## SoFlaModel3 (Apr 15, 2017)

Model34mePlease said:


> At that point they will have produced about 500k Model 3s and have gone through their entire current backlog and you will then be 1st in line.


Of course there could be another surge in reservations once the general public sees this mysterious car on the road that has had zero advertising.


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## Jay McGinnis (Apr 19, 2016)

So let me get this straight ... this is a tax credit, not a tax deduction (like I get on my home mortgage)? I can actually reduce my tax liability by $7,500 when I do my taxes for the year 2018? (My delivery estimator says Dec 2017-Feb2018 for Standard Battery)


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## garsh (Apr 4, 2016)

Jay McGinnis said:


> So let me get this straight ... this is a tax credit, not a tax deduction (like I get on my home mortgage)? I can actually reduce my tax liability by $7,500 when I do my taxes for the year 2018? (My delivery estimator says Dec 2017-Feb2018 for Standard Battery)


Yes, exactly.


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## Brokedoc (May 28, 2017)

Jay McGinnis said:


> So let me get this straight ... this is a tax credit, not a tax deduction (like I get on my home mortgage)? I can actually reduce my tax liability by $7,500 when I do my taxes for the year 2018? (My delivery estimator says Dec 2017-Feb2018 for Standard Battery)


Tax Credit. Whatever you owe in Federal Taxes gets reduced by $7500 (or less when the phase out begins). If you owe less than $7500 in federal taxes, you cannot get the remaining credit back as cash. (and you probably shouldn't be buying a Tesla)


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## Model34mePlease (Jun 3, 2017)

Jay McGinnis said:


> So let me get this straight ... this is a tax credit, not a tax deduction (like I get on my home mortgage)? I can actually reduce my tax liability by $7,500 when I do my taxes for the year 2018? (My delivery estimator says Dec 2017-Feb2018 for Standard Battery)


Yes, it is a credit, not a deduction. You get the benefit dollar for dollar. However it is not refundable, so it can only reduce your tax liability down to zero, not generate a refund.


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## SoFlaModel3 (Apr 15, 2017)

Jay McGinnis said:


> So let me get this straight ... this is a tax credit, not a tax deduction (like I get on my home mortgage)? I can actually reduce my tax liability by $7,500 when I do my taxes for the year 2018? (My delivery estimator says Dec 2017-Feb2018 for Standard Battery)


A tax dedication reduces your tax liability.

This is a tax credit. If you have a tax liability of $7,500 or more you will get back the $7,500.


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## Jay McGinnis (Apr 19, 2016)

OK, my delivery estimator is Oct - Dec 2017 for First Production and Dec 2017 - Feb 2018 for Standard Battery. Decisions, decisions....


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## Kizzy (Jul 25, 2016)

Jay McGinnis said:


> So let me get this straight ... this is a tax credit, not a tax deduction (like I get on my home mortgage)? I can actually reduce my tax liability by $7,500 when I do my taxes for the year 2018? (My delivery estimator says Dec 2017-Feb2018 for Standard Battery)


Wait, wait, wait. I'm getting a little worried. If I paid $7,500 in taxes and at tax time, when preparing my return (before getting to the EV tax credit), let's say I owe $1. Do I get back $7,499 in a refund or do I simply owe $0 at filing?


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## Model34mePlease (Jun 3, 2017)

Kizzy said:


> Wait, wait, wait. I'm getting a little worried. If I paid $7,500 in taxes and at tax time, when preparing my return (before getting to the EV tax credit), let's say I owe $1. Do I get back $7,499 in a refund or do I simply owe $0 at filing?


You get back $7499. It just can't generate a refund beyond what you have paid in.


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## SoFlaModel3 (Apr 15, 2017)

Kizzy said:


> Wait, wait, wait. I'm getting a little worried. If I paid $7,500 in taxes and at tax time, when preparing my return (before getting to the EV tax credit), let's say I owe $1. Do I get back $7,499 in a refund or do I simply owe $0 at filing?





Model34mePlease said:


> You get back $7499. It just can't generate a refund beyond what you have paid in.


This is right but may be confusing.

More details...

You paid $7,500 during the year. You owe $1 when filing your taxes.

Your tax liability is $7,501.

Since you owe $1, now your refund is $7,499.


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## Model34mePlease (Jun 3, 2017)

SoFlaModel3 said:


> This is right but may be confusing.
> 
> More details...
> 
> ...


Have we beaten this horse enough yet?


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## SoFlaModel3 (Apr 15, 2017)

Model34mePlease said:


> Have we beaten this horse enough yet?


I'm sure there will be 20 more posts/threads on this topics over the next few months


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## Uricasha (Feb 19, 2017)

You could always commit tax fraud and pretend you purchased the car in early 2018. Heck, you technically purchased your spot in line last year. The IRS doesn't care about us middle class schmucks? http://www.investopedia.com/articles/taxes/020317/what-will-get-you-audited-irs-2016-taxes.asp


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## tivoboy (Mar 24, 2017)

Brokedoc said:


> Tax Credit. Whatever you owe in Federal Taxes gets reduced by $7500 (or less when the phase out begins). If you owe less than $7500 in federal taxes, you cannot get the remaining credit back as cash. (and you probably shouldn't be buying a Tesla)


does anyone know exactly is this is income taxes only, or does it include taxes for soc/sec, fica, medicare, etc, and possibly capital gains or dividend income?


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## Brokedoc (May 28, 2017)

tivoboy said:


> does anyone know exactly is this is income taxes only, or does it include taxes for soc/sec, fica, medicare, etc, and possibly capital gains or dividend income?


This tax credit should apply to your total Federal Income Tax liability - everything that you report at the end of the year on your 1040. Check with your accountant.


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## BrianP (Jul 28, 2017)

Apologizes if this has already been discussed in this thread, I did a quick search and didn't see any detailed discussion. Given that tax reform is next up on the US Congress's agenda, I'm thinking that there's a good chance the EV tax credit will be ended for the 2018 tax year. Are there many reasons not to think this is true? 

My projected delivery date is Q1 2018, I'm not counting on the tax credit.


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## garsh (Apr 4, 2016)

BrianP said:


> Apologizes if this has already been discussed in this thread, I did a quick search and didn't see any detailed discussion. Given that tax reform is next up on the US Congress's agenda, I'm thinking that there's a good chance the EV tax credit will be ended for the 2018 tax year. Are there many reasons not to think this is true?


Yes, I covered this much earlier in this thread (and probably elsewhere on this site):


garsh said:


> Unlikely. If anything, the other automakers are going to use the credit as a tool to combat Tesla (because Tesla will run out, but it will be available for them), so they'll push *against* eliminating it.


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## BrianP (Jul 28, 2017)

Yes, I saw that statement, but I was hoping for more detailed discussion. That one point doesn't particularly convince me that the tax credit is safe for 2018.


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## Reef Club (Jun 18, 2017)

BrianP said:


> Apologizes if this has already been discussed in this thread, I did a quick search and didn't see any detailed discussion. Given that tax reform is next up on the US Congress's agenda, I'm thinking that there's a good chance the EV tax credit will be ended for the 2018 tax year. Are there many reasons not to think this is true?
> 
> My projected delivery date is Q1 2018, I'm not counting on the tax credit.


I heard from my Congressman that they will not touch this because the Big 3 are behind in producing EVs and will need this to catch up to Tesla. If Elon was still on the President's Council I bet they would extend it making it larger, say $10,000,


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## BrianP (Jul 28, 2017)

Reef Club said:


> I heard from my Congressman that they will not touch this because the Big 3 are behind in producing EVs and will need this to catch up to Tesla. If Elon was still on the President's Council I bet they would extend it making it larger, say $10,000,


I'd like to believe this, but I don't think the current congress or administration cares about EV production, and would not care if the Big 3 reduced or stopped it.


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## SoFlaModel3 (Apr 15, 2017)

BrianP said:


> I'd like to believe this, but I don't think the current congress or administration cares about EV production, and would not care if the Big 3 reduced or stopped it.


But the big 3 need to complete with Tesla and without a credit helping good luck to them...

Ps funny calling them big 3.

They're the smaller 3


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## garsh (Apr 4, 2016)

BrianP said:


> I'd like to believe this, but I don't think the current congress or administration cares about EV production, and would not care if the Big 3 reduced or stopped it.


BUT... the other automakers are starting to see that electric is the way things are headed for the future. They disagree on how soon (The Germans - VW, Porsche, BMW - know that it's coming very soon. Japanese think it's far off. Americans somewhere in-between). The *automakers* will end up pushing Congress hard to maintain the credit. And we all know that their lobbyists are pretty good at convincing Congress to vote their way - and even easier when all they want is for Congress to NOT make a change.


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## BrianP (Jul 28, 2017)

garsh said:


> BUT... the other automakers are starting to see that electric is the way things are headed for the future. They disagree on how soon (The Germans - VW, Porsche, BMW - know that it's coming very soon. Japanese think it's far off. Americans somewhere in-between). The *automakers* will end up pushing Congress hard to maintain the credit. And we all know that their lobbyists are pretty good at convincing Congress to vote their way - and even easier when all they want is for Congress to NOT make a change.


You guys are giving me hope, thanks! Does anyone have an idea of when we'd know for sure if the tax credit will continue through 2018? I'd hate to buy the car in Q1 2018, then find out afterwards that the tax credit is being killed. I'll buy the car either way, but that would affect what options I get. I'm leaning towards the 1st production model because of the credit.


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## tivoboy (Mar 24, 2017)

BrianP said:


> Yes, I saw that statement, but I was hoping for more detailed discussion. That one point doesn't particularly convince me that the tax credit is safe for 2018.


I don't think the federal tax credit, 2500$+419 per kwh (above 4kwh) up to 7,500$ max is an annual renewal, this was a component of bills in 2009 and 2013 which went out into the future and were funded. it would be pretty hard to change it without 60 votes and/or a major change in the budget bills. I don't recall seeing it removed in the draconian budget proposals that we have seen some sense of (was that too political?)


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## tivoboy (Mar 24, 2017)

garsh said:


> BUT... the other automakers are starting to see that electric is the way things are headed for the future. They disagree on how soon (The Germans - VW, Porsche, BMW - know that it's coming very soon. Japanese think it's far off. Americans somewhere in-between). The *automakers* will end up pushing Congress hard to maintain the credit. And we all know that their lobbyists are pretty good at convincing Congress to vote their way - and even easier when all they want is for Congress to NOT make a change.


most automakers I know realize that electric is the next stop on the road to hydrogen.


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## M3OC Rules (Nov 18, 2016)

garsh said:


> BUT... the other automakers are starting to see that electric is the way things are headed for the future. They disagree on how soon (The Germans - VW, Porsche, BMW - know that it's coming very soon. Japanese think it's far off. Americans somewhere in-between). The *automakers* will end up pushing Congress hard to maintain the credit. And we all know that their lobbyists are pretty good at convincing Congress to vote their way - and even easier when all they want is for Congress to NOT make a change.


I agree at this point they will support keeping the credit because it will soon become an even worse disadvantage for Tesla. I think the Germans are more serious about electric vehicles because they are losing the most sales to Tesla. They got killed at the luxury large sedan and are about to get killed at the entry level luxury. The big 3 won't get worked up until the Model Y starts eating into SUV sales. The pickup truck market will be interesting when Tesla enters but may not be as easy for Tesla as the sedans.


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## codex57 (Aug 31, 2017)

With current technology, I don't see the Americans caring at all because a competitive full sized pickup won't be realistic for many, many years. Even if Tesla takes some small SUV sales, it won't be enough to make the Americans notice much. Ford will notice the most since they sell so many Escapes, but even then, I don't see it making them hurry any more than they already are. The full sized pickups/SUVs make up such a huge proportion of their profits (and they make so little from sedans) that whatever sedan sales Tesla takes isn't enough to bother them.

I agree that it's the Germans who are getting killed (relatively speaking) now and in the near future.


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## JWardell (May 9, 2016)

codex57 said:


> With current technology, I don't see the Americans caring at all because a competitive full sized pickup won't be realistic for many, many years. Even if Tesla takes some small SUV sales, it won't be enough to make the Americans notice much. Ford will notice the most since they sell so many Escapes, but even then, I don't see it making them hurry any more than they already are. The full sized pickups/SUVs make up such a huge proportion of their profits (and they make so little from sedans) that whatever sedan sales Tesla takes isn't enough to bother them.
> 
> I agree that it's the Germans who are getting killed (relatively speaking) now and in the near future.


All Americans don't drive full-sized pickup trucks.

Many Americans wish US-made small-medium sized pickups were more available, and begrudgingly get a full-sized instead. (RIP Ford Ranger)

A large number of full-size pickups are sold in the $40-50 grand price range.

Tesla could come with a medium-sized pickup for $35-40 grand and absolutely clean up.


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## ummgood (Feb 13, 2017)

JWardell said:


> All Americans don't drive full-sized pickup trucks.
> 
> Many Americans wish US-made small-medium sized pickups were more available, and begrudgingly get a full-sized instead. (RIP Ford Ranger)
> 
> ...


As long as it has decent towing capacity.

To me I am envisioning a Tesla pickup to resemble a Ridgeline. Most people here in Texas laugh at it because it just simply isn't a work truck. People might consider a midsized truck here (think Tacoma or Colorado) but if it doesn't have some type of heavy duty ability it isn't going to eat into the big 3's truck profits at all. The Ridgeline is really limited in its towing and bed hauling ability. Most of these owners are going to ask "can I tow a trailer full of stuff" or "can I throw 30 bags of dirt in the back and not worry about the truck?"

Now if they can pull off getting past the "cartruck" image then they might have something. It took the Tundra forever to get up to level with the F150/Ram/Silverado.


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## Craig-TX (Sep 13, 2017)

ummgood said:


> As long as it has decent towing capacity.
> ...
> Now if they can pull off getting past the "cartruck" image then they might have something.


These exact two statements are why I believe Tesla went Semi first. Tesla could build an incredible truck with great hauling / pulling capability, but they won't build a truck that looks like a traditional F-150. And without that big-truck look, it will be hard to convince the general public. (Trust me, I live in Fort Worth, Texas. I know and work with the "general public" that wants to "haul things".)

In a lot of ways a semi is easier. The public opinion of 'does it look like it should be able to do what it claims' doesn't matter as much. The companies that will buy it, buy it based on very economical decisions, and a lot less emotional decisions. If it will claim to do the same job but at a cheaper price, it doesn't matter what it looks like (within reason).

Once the semi is out and the general public sees that Tesla make a great big rig that can pull a full load, that will boost the brand image in that market. It will take a few years to build that image, but that is exactly what it will do. It's then that some of the general public will start to take the idea of a pickup seriously.

Some, on the other hand will have to see the pickup pulling a 40 foot fifth wheel camper uphill effortlessly at 60 mph, while their 1 ton diesel struggles.


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## ummgood (Feb 13, 2017)

Craig-TX said:


> These exact two statements are why I believe Tesla went Semi first. Tesla could build an incredible truck with great hauling / pulling capability, but they won't build a truck that looks like a traditional F-150. And without that big-truck look, it will be hard to convince the general public. (Trust me, I live in Fort Worth, Texas. I know and work with the "general public" that wants to "haul things".)
> 
> In a lot of ways a semi is easier. The public opinion of 'does it look like it should be able to do what it claims' doesn't matter as much. The companies that will buy it, buy it based on very economical decisions, and a lot less emotional decisions. If it will claim to do the same job but at a cheaper price, it doesn't matter what it looks like (within reason).
> 
> ...


I agree completely.


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## Matt Maxwell (Sep 19, 2017)

Hello. I reserved my M3 in April 2017. ETA for delivery is May 2018. But I'm trying to decide if I can financially afford the MS instead. I know this is a dumb question, but I'm so confused. Can someone PLEASE break down exactly what a federal income tax credit is? I know it reduces your overall tax liability, but I don't know what that means. Do I get a check for $7500? I'm just trying to figure out how much money I'm going to get in my pocket with the fed credit. I live in CA. So from what I understand, our state rebate is basically you getting a $2500 check, right? Do you have to wait until tax time for that? And please help me out with my fed tax credit question. Ugh. So lost. Not a financial guy. Thanks.


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## SoFlaModel3 (Apr 15, 2017)

Matt Maxwell said:


> Hello. I reserved my M3 in April 2017. ETA for delivery is May 2018. But I'm trying to decide if I can financially afford the MS instead. I know this is a dumb question, but I'm so confused. Can someone PLEASE break down exactly what a federal income tax credit is? I know it reduces your overall tax liability, but I don't know what that means. Do I get a check for $7500? I'm just trying to figure out how much money I'm going to get in my pocket with the fed credit. I live in CA. So from what I understand, our state rebate is basically you getting a $2500 check, right? Do you have to wait until tax time for that? And please help me out with my fed tax credit question. Ugh. So lost. Not a financial guy. Thanks.


It's a credit, not a deduction.

If you have a tax liability of $7,500 (or more) you will essentially get this money back in the form of a refund when you file your taxes or throughout the year if you adjust your withholding on your paycheck.

For instance, if you get your car in 2018.

Let's say you get paid bi-weekly, so 26 paychecks.

Adjust your withholdings in 2018 to take home $288.46 ($7,500 credit / 26 paychecks) more.

If your tax liability is $5,000 you can only earn up to $5,000 in tax credit and give up the $2,500 (it cannot be rolled over).


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## Matt Maxwell (Sep 19, 2017)

SoFlaModel3 said:


> It's a credit, not a deduction.
> 
> If you have a tax liability of $7,500 (or more) you will essentially get this money back in the form of a refund when you file your taxes or throughout the year if you adjust your withholding on your paycheck.
> 
> ...


Wow, that was super helpful. I've been trying to figure this out for a while now. Couple quick follow up questions if you don't mind.

So essentially, I need to change my withholdings to get more in my paycheck so that I get taxed more. What you're saying is that I want to OWE about 7500 to the government come tax time to receive the full benefit, right? If I usually break even (or get money back) on my taxes, I won't see this benefit?

And along those lines, if I get a MS this year, but already have my withholdings set up so that I get money back on my taxes, I'm screwed, right? I'm looking to buy sooner, rather than later. And I want to get as much cash in my pocket as possible. Cause the MS is more than I wanted to spend.

For a cop, I'm actually pretty dumb with this stuff. So I appreciate you taking the time to explain.


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## Brokedoc (May 28, 2017)

Matt Maxwell said:


> Wow, that was super helpful. I've been trying to figure this out for a while now. Couple quick follow up questions if you don't mind.
> 
> So essentially, I need to change my withholdings to get more in my paycheck so that I get taxed more. What you're saying is that I want to OWE about 7500 to the government come tax time to receive the full benefit, right? If I usually break even (or get money back) on my taxes, I won't see this benefit?
> 
> ...


The $7500 you get counts towards you ENTIRE tax liability for the year. As a round example, if you make $100k/year and pay $30k in federal taxes, you now only need to pay $30k minus the $7.5k credit. The withholding in your paycheck is just an easy way to pay the government the estimated amount you owe. Changing your withholding doesn't change the amount of tax you owe - it just makes it so that you get a refund check when you file your taxes if you over-withhold or if you need to write a check if you under-withhold.

If you leave your withholding the same and normally get a tax refund when you file, I think it's likely that you would get the extra $7500 in your tax refund check if you have the typical California cop salary and don't have a lot of extra deductions. If you would prefer to get a bigger paycheck instead of a bigger tax refund, you can adjust your withholding instead.


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## SoFlaModel3 (Apr 15, 2017)

Matt Maxwell said:


> Wow, that was super helpful. I've been trying to figure this out for a while now. Couple quick follow up questions if you don't mind.
> 
> So essentially, I need to change my withholdings to get more in my paycheck so that I get taxed more. What you're saying is that I want to OWE about 7500 to the government come tax time to receive the full benefit, right? If I usually break even (or get money back) on my taxes, I won't see this benefit?
> 
> ...


No no no no let me better clarify.

It's not what you owe at "tax time" but rather your actual tax liability. If you owe $0 at tax time you have done a great job managing it. No one wants a refund (an interest free loan to the government throughout the year) and no one wants to owe (that hurts and may have penalties attached).

So with the logic that you have set your withholdings properly you should owe nothing each year.

Now since you're getting a $7,500 tax credit you want to adjust your withholdings to take home more each paycheck and essentially withhold less for taxes. This way you earn the $7,500 evenly over each paycheck in 2018 rather than waiting for it in one lump sum in April 2019.

One last note, if you get your car in 2017... do not follow my advice. Remember the "refund" in 2018 is for activities in 2017 so you would just file your taxes as you normally do and as long as your liability was $7,500 or more you will get a nice refund!

Hope that helps!!!


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## Brokedoc (May 28, 2017)

SoFlaModel3 said:


> One last note, if you get your car in 2017... do not follow my advice. Remember the "refund" in 2018 is for activities in 2017 so you would just file your taxes as you normally do and as long as your liability was $7,500 or more you will get a nice refund!
> QUOTE]


Good point. The poster sounds like he's in a hurry to get a car so likely he will buy in 2017. It would make no sense to adjust withholding now since the year is almost over. He would just leave the withholding alone and get a nice tax return check instead


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## Frank99 (Aug 3, 2017)

No, you don't have to OWE anything to Uncle Sam to get the Tax Credit. You simply have to have at least $7500 of tax liability for the year.

Let's try an example. You're single, earn $100,000 a year, and with deductions end up with a taxable income of, say, $66000. According to the 1040 Tax tables, that means you have a tax liability of $12,000. Your employer has been taking out taxes every two weeks, so you've paid $13,000 to the IRS. Your tax return shows that you'll get a refund of $1000. Do you qualify for the Tax Credit?

The answer is yes - your tax liability is more than $7500, so you can take the full credit, and you'll get ($7500 + $1000) back as a refund. The Tax Credit is based solely on the amount of tax that you were liable for during the year, ignoring any payments that have been made. 

What SoFlaModel3 is recommending is adjusting your withholding amount so that you get the money back over the year (by paying less tax on each paycheck) rather than getting a big refund next year after filing your taxes. Theoretically, that's better because you can invest the money over the year and end up with more than by waiting for your refund. As a practical matter, for the vast majority of people for whom "invest" means "put it into my savings account making 1% interest", the difference is minimal and waiting for a refund is the simplest and most foolproof approach.


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## Matt Maxwell (Sep 19, 2017)

Brokedoc said:


> The $7500 you get counts towards you ENTIRE tax liability for the year. As a round example, if you make $100k/year and pay $30k in federal taxes, you now only need to pay $30k minus the $7.5k credit. The withholding in your paycheck is just an easy way to pay the government the estimated amount you owe. Changing your withholding doesn't change the amount of tax you owe - it just makes it so that you get a refund check when you file your taxes if you over-withhold or if you need to write a check if you under-withhold.
> 
> If you leave your withholding the same and normally get a tax refund when you file, I think it's likely that you would get the extra $7500 in your tax refund check if you have the typical California cop salary and don't have a lot of extra deductions. If you would prefer to get a bigger paycheck instead of a bigger tax refund, you can adjust your withholding instead.


You guys were very helpful. Thank you. I'm crunching the numbers and I just don't want to pay the 10-15k more for the MS. 40k for the M3 I want vs 70k for a new MS is too big a jump. Even with the tax rebates and credits. So sadly, I will probably just wait until May for my M3. It will be tough though. Maybe there will still be at least a partial tax rebate by that time. Thanks again, everyone.


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## SoFlaModel3 (Apr 15, 2017)

Matt Maxwell said:


> You guys were very helpful. Thank you. I'm crunching the numbers and I just don't want to pay the 10-15k more for the MS. 40k for the M3 I want vs 70k for a new MS is too big a jump. Even with the tax rebates and credits. So sadly, I will probably just wait until May for my M3. It will be tough though. Maybe there will still be at least a partial tax rebate by that time. Thanks again, everyone.


You're welcome and at worst a Model 3 bought in May will earn a $3,750 federal tax credit and at best $7,500. We won't know until sales through 4th quarter are reported in early 2018.


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## Brokedoc (May 28, 2017)

Matt Maxwell said:


> You guys were very helpful. Thank you. I'm crunching the numbers and I just don't want to pay the 10-15k more for the MS. 40k for the M3 I want vs 70k for a new MS is too big a jump. Even with the tax rebates and credits. So sadly, I will probably just wait until May for my M3. It will be tough though. Maybe there will still be at least a partial tax rebate by that time. Thanks again, everyone.


For a cop, Agent Maxwell, you sound SMART!

Sorry. I couldn't resist....


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## JohnnieB (Sep 20, 2017)

Maybe just play it safe if you have a 2017 delivery estimate and go ahead and get your long range with premium:kissing:


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## EvenSteven (Sep 15, 2017)

Frank99 said:


> No, you don't have to OWE anything to Uncle Sam to get the Tax Credit. You simply have to have at least $7500 of tax liability for the year.
> 
> Let's try an example. You're single, earn $100,000 a year, and with deductions end up with a taxable income of, say, $66000. According to the 1040 Tax tables, that means you have a tax liability of $12,000. Your employer has been taking out taxes every two weeks, so you've paid $13,000 to the IRS. Your tax return shows that you'll get a refund of $1000. Do you qualify for the Tax Credit?
> 
> ...


I think there is a maximum amount you can earn before the credit does not apply to you. I'm not sure the exact number though. I thought it was around $180K. Don't quote me on it and I could be wrong.


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## $ Trillion Musk (Nov 5, 2016)

Hoping that "doing the right thing" would mean that those of us in the US who expect deliveries in Q1 and/or Q2 of 2018 will qualify for the full $7,500 federal tax incentive; aka those of us early reservationists who can't afford to shell out an extra $9,000 for the long range battery option.


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## Bokonon (Apr 13, 2017)

EvenSteven said:


> I think there is a maximum amount you can earn before the credit does not apply to you. I'm not sure the exact number though. I thought it was around $180K. Don't quote me on it and I could be wrong.


There is no income limit for the federal credit. Several states have started imposing income limits on their state-level EV rebates/credits, but the federal credit does not have any such restrictions.

The only potential "gotcha" with the federal credit is that it is non-refundable. In other words, if your tax liability for that year (including payroll deductions) is less than the credit amount, you cannot claim the credit for more than your tax liability.* However, my guess is that this will not be an issue in practice for many (if not most) people buying a Model 3.

* Not a CPA -- my word-choice here may not be 100% accurate


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## Uricasha (Feb 19, 2017)

EvenSteven said:


> I think there is a maximum amount you can earn before the credit does not apply to you. I'm not sure the exact number though. I thought it was around $180K. Don't quote me on it and I could be wrong.


Boko stole my thunder....

I think you may be referring to income limits on state tax credits (California has an income limit of $150,000). On the federal level, IRS tax code IRC-30D doesn't currently have an income limit.


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## EvenSteven (Sep 15, 2017)

thats probably what I read.


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## SoFlaModel3 (Apr 15, 2017)

Safe Daddy Driver said:


> Hoping that "doing the right thing" would mean that those of us in the US who expect deliveries in Q1 and/or Q2 of 2018 will qualify for the full $7,500 federal tax incentive; aka those of us early reservationists who can't afford to shell out an extra $9,000 for the long range battery option.


My best guess remains that car 200k is going to hit in late Q4 (with no intervention). Now with this volume on some level I have an expectation of thousands of cars being in transit and potentially undelivered such that they get delivered in the first week of 2018.

That said -- the "right thing" can take on a lot of meanings. Technically speaking they've already done the "right thing" by having a massive ramp up in production and giving priority to US deliveries.

Should car 200k drop in Q4, they have ensured that each US customer with a Model 3 reservation (even one coming in today) earns a piece of the credit. I wouldn't make any assumptions here that the right thing means specifically delaying though Tesla certainly is the type of company that would hold back deliveries if the credit was close as they neared the end of a quarter.


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## MelindaV (Apr 2, 2016)

Matt Maxwell said:


> You guys were very helpful. Thank you. I'm crunching the numbers and I just don't want to pay the 10-15k more for the MS. 40k for the M3 I want vs 70k for a new MS is too big a jump. Even with the tax rebates and credits. So sadly, I will probably just wait until May for my M3. It will be tough though. Maybe there will still be at least a partial tax rebate by that time. Thanks again, everyone.


pull out your 2016 return and look at line 47 (assuming you filed 1040). this was your tax liability.


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## sam s (Oct 18, 2016)

What if you filed jointly with your spouse? Does both your incomes count toward the tax liability? Also, say you only have a tax liability of 4k, is there any benefit of waiting till the credit is 1/2 at 3750?


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## SoFlaModel3 (Apr 15, 2017)

MelindaV said:


> pull out your 2016 return and look at line 47 (assuming you filed 1040). this was your tax liability.





sam s said:


> What if you filed jointly with your spouse? Does both your incomes count toward the tax liability? Also, say you only have a tax liability of 4k, is there any benefit of waiting till the credit is 1/2 at 3750?


If you're married filing jointly you have a higher tax liability!

If you have a tax liability of $4,000 and your car qualifies for the $7,500 credit then you would get a credit of $4,000. No reason to wait for the credit to drop to $3,750 and lose $250....


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## garsh (Apr 4, 2016)

sam s said:


> Also, say you only have a tax liability of 4k, is there any benefit of waiting till the credit is 1/2 at 3750?


There are ways to increase your tax liability. If you have a 401k, converting some of it to a Roth 401k will raise your tax liability, and then that money is now tax-free when you use it in retirement.


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## danzgator (May 17, 2017)

SoFlaModel3 said:


> My best guess remains that car 200k is going to hit in late Q4 (with no intervention). Now with this volume on some level I have an expectation of thousands of cars being in transit and potentially undelivered such that they get delivered in the first week of 2018.
> 
> That said -- the "right thing" can take on a lot of meanings. Technically speaking they've already done the "right thing" by having a massive ramp up in production and giving priority to US deliveries.
> 
> Should car 200k drop in Q4, they have ensured that each US customer with a Model 3 reservation (even one coming in today) earns a piece of the credit. I wouldn't make any assumptions here that the right thing means specifically delaying though Tesla certainly is the type of company that would hold back deliveries if the credit was close as they neared the end of a quarter.


There's no way that Tesla would deliver car 200k at the end of a quarter. They'd be nuts to allow that to happen because it's bad for Tesla and reservation holders on so many levels. The only plus side is it shows more revenue for that quarter, but on balance, the upside is nowhere near the downside. This issue is easily solved by letting produced inventory pile up at the end of the quarter and delivering the next quarter in order to maximize the tax credits reservation holders will receive.


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## barjohn (Aug 31, 2017)

If you buy two electric vehicles where either qualifies for the $7,500 tax credit do you get a $15K tax credit for the year?


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## SoFlaModel3 (Apr 15, 2017)

danzgator said:


> There's no way that Tesla would deliver car 200k at the end of a quarter. They'd be nuts to allow that to happen because it's bad for Tesla and reservation holders on so many levels. The only plus side is it shows more revenue for that quarter, but on balance, the upside is nowhere near the downside. This issue is easily solved by letting produced inventory pile up at the end of the quarter and delivering the next quarter in order to maximize the tax credits reservation holders will receive.


Right we're saying the same thing. My point was that US bound car number 200k hits in Q4 "without intervention". The intervention part was implying that they would hold inventory and deliver in January if it was close to the end of the quarter.


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## SoFlaModel3 (Apr 15, 2017)

John Griffith said:


> If you buy two electric vehicles where either qualifies for the $7,500 tax credit do you get a $15K tax credit for the year?


So long as you have a $15,000 tax liability, yes, you will get a credit for each vehicle purchased.


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## Brokedoc (May 28, 2017)

SoFlaModel3 said:


> So long as you have a $15,000 tax liability, yes, you will get a credit for each vehicle purchased.


Correct. Plus a business or individual that purchases multiple new EVs will get an unlimited number of tax credits. For example: Fleet owners or banks like If Chase Bank underwrites leases for 10,000 Teslas, Chase will be able to have 10,000 tax credits.


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## barjohn (Aug 31, 2017)

Thank you all for the answer. I sold an investment property this year so between the capital gains tax and 25% depreciation recapture, I could use the $15K credit. Next year might be problematic for me as my retirement income does not create a $7,500 tax liability. Unfortunately, I am in the Jan-March window for my model 3 and an S is just too much more money. I am hoping enough cancellations occur where buyers opted to get an S instead (especially with the upcoming change to only offering AWD 75KW as the bottom end model) or enough get tired of waiting to push it over the edge.

Does anyone know if the car must be delivered or if it is paid for in December but delivery slips into January does it count as a 2017 purchase or a 2018 purchase. It would seem to me that as a cash basis entity, once I part with my cash and sign a contract, I have made a purchase even if delivery is delayed. Sort of like I order and pay for an item from Amazon on December 28th and it arrives at my home on January 2nd. From a tax stand point it is a 2017 purchase.


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## kmngq (Aug 27, 2017)

John Griffith said:


> Does anyone know if the car must be delivered or if it is paid for in December but delivery slips into January does it count as a 2017 purchase or a 2018 purchase.


It's when you take delivery of car. I'm assuming all paper work, loans, registration all happen at delivery.


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## barjohn (Aug 31, 2017)

Suppose you were willing and paid Tesla Cash up front in December for delivery in January. The only thing Tesla would have to do is complete the registration paperwork and deliver the vehicle once ready. Legally, you have made a purchase and paid your money just like you do with many on-line purchases and you don't take delivery until the item is shipped and delivered to you. For example, order a new sofa from Pottery barn. They charge you up front and you pay cash or credit card at the time of ordering. They deliver 4-6 weeks later. If you are on a cash based accounting, the sale happened when you made your payment. I'll give you another example. I rented a vacation home. At one point I required payment in full at time of placing the order. Even though there was a possibility I would have to refund at least part of the money in the event of a cancellation or a hurricane, the IRS required me to treat the transaction as a sale, when I received the funds, and not when I delivered the rental property and the rental period ended and my contingent liability ended. Should I have to make a refund due to a cancellation it was an impact to the current years revenue and sales, not the prior years.


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## K-MTG (Sep 22, 2017)

John Griffith said:


> Suppose you were willing and paid Tesla Cash up front in December for delivery in January. The only thing Tesla would have to do is complete the registration paperwork and deliver the vehicle once ready. Legally, you have made a purchase and paid your money just like you do with many on-line purchases and you don't take delivery until the item is shipped and delivered to you. For example, order a new sofa from Pottery barn. They charge you up front and you pay cash or credit card at the time of ordering. They deliver 4-6 weeks later. If you are on a cash based accounting, the sale happened when you made your payment. I'll give you another example. I rented a vacation home. At one point I required payment in full at time of placing the order. Even though there was a possibility I would have to refund at least part of the money in the event of a cancellation or a hurricane, the IRS required me to treat the transaction as a sale, when I received the funds, and not when I delivered the rental property and the rental period ended and my contingent liability ended. Should I have to make a refund due to a cancellation it was an impact to the current years revenue and sales, not the prior years.


So if I pay for my car in December but take delivery in January - I can still get the $7500 deduction in April 2017?


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## kmngq (Aug 27, 2017)

John Griffith said:


> Suppose you were willing and paid Tesla Cash up front in December for delivery in January. The only thing Tesla would have to do is complete the registration paperwork and deliver the vehicle once ready. Legally, you have made a purchase and paid your money just like you do with many on-line purchases and you don't take delivery until the item is shipped and delivered to you. For example, order a new sofa from Pottery barn. They charge you up front and you pay cash or credit card at the time of ordering. They deliver 4-6 weeks later. If you are on a cash based accounting, the sale happened when you made your payment. I'll give you another example. I rented a vacation home. At one point I required payment in full at time of placing the order. Even though there was a possibility I would have to refund at least part of the money in the event of a cancellation or a hurricane, the IRS required me to treat the transaction as a sale, when I received the funds, and not when I delivered the rental property and the rental period ended and my contingent liability ended. Should I have to make a refund due to a cancellation it was an impact to the current years revenue and sales, not the prior years.


I understand your reasoning, but unfortunately, it doesn't work like that. First of all, I don't think you pay for the car up front, just a deposit. If Telsa were to allow you to prepay, Then everyone who wants the full $7500 tax credit will just pay up front. I'm pretty sure the sale date of a car is the date the car was put to use by its new owner. I mean, I could be wrong, but that is my understanding.


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## K-MTG (Sep 22, 2017)

kmngq said:


> I understand your reasoning, but unfortunately, it doesn't work like that. First of all, I don't think you pay for the car up front, just a deposit. If Telsa were to allow you to prepay, Then everyone who wants the full $7500 tax credit will just pay up front. I'm pretty sure the sale date of a car is the date the car was put to use by its new owner. I mean, I could be wrong, but that is my understanding.


When I purchased an X, I had the opportunity to pay for the vehicle with a bank transfer on MyTesla a few weeks before delivery. I am not sure if that makes a difference based on what you mentioned.


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## SoFlaModel3 (Apr 15, 2017)

John Griffith said:


> Suppose you were willing and paid Tesla Cash up front in December for delivery in January. The only thing Tesla would have to do is complete the registration paperwork and deliver the vehicle once ready. Legally, you have made a purchase and paid your money just like you do with many on-line purchases and you don't take delivery until the item is shipped and delivered to you. For example, order a new sofa from Pottery barn. They charge you up front and you pay cash or credit card at the time of ordering. They deliver 4-6 weeks later. If you are on a cash based accounting, the sale happened when you made your payment. I'll give you another example. I rented a vacation home. At one point I required payment in full at time of placing the order. Even though there was a possibility I would have to refund at least part of the money in the event of a cancellation or a hurricane, the IRS required me to treat the transaction as a sale, when I received the funds, and not when I delivered the rental property and the rental period ended and my contingent liability ended. Should I have to make a refund due to a cancellation it was an impact to the current years revenue and sales, not the prior years.


It is entirely based on registration of the vehicle and not when the auto manufacturer receives money from you. This all transpires on "delivery day". Your best chance here isn't the upsell to Model S but rather people waiting for the standard battery or dual motor.


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## actong (Aug 27, 2017)

https://www.irs.gov/businesses/plug-in-electric-vehicle-credit-irc-30-and-irc-30d

Per IRS:



> For purposes of the 30D credit, a vehicle is not considered acquired prior to the time when title to the vehicle passes to the taxpayer under state law.


Depends on the state, but presumably means you at least have possession of the car.


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## MelindaV (Apr 2, 2016)

i believe for the sake of the tax credit, it is when the car is registered with your local state licensing, which likely would be done at the same time you handed that bag of cash (cashiers check) over to Tesla, not on the day you pick the physical car up in your senerio.


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## SoFlaModel3 (Apr 15, 2017)

MelindaV said:


> i believe for the sake of the tax credit, it is when the car is registered with your local state licensing, which likely would be done at the same time you handed that bag of cash (cashiers check) over to Tesla, not on the day you pick the physical car up in your senerio.


To be 100% on this it would be when you "complete paperwork". Whether you pickup the car or not is ultimately irrelevant. I don't know that Tesla wants to hold the car after it's yours though outside of servicing it.


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## Dr. J (Sep 1, 2017)

Let's recap:

The $7,500 EV tax credit for Tesla models will be available (assuming no relevant change in tax law) through the calendar quarter in which 200,000 units are sold, and then for one more quarter. The credit will be half of that for the next two quarters. If Tesla can hold off selling that 200,000th US unit until January 2018 (which I believe it can w/o pissing off anyone), the max credit is available currently and through June 30, 2018, and the half credit is available for July 1-December 31, 2018. I believe it halves again (under current law) for the following six months, but if you're planning that far in advance, I wouldn't bet either way on what tax law looks like in 2019.
The credit is a dollar for dollar reduction in tax liability. If between withholding and the credit you've "paid" more than your tax liability, you can request a tax refund for the difference.
The credit is non-refundable, which means if you don't have that much tax liability, you benefit only to the extent of your tax liability.
If you don't have enough tax liability, you can (perfectly legally) "manufacture" tax liability by, for example, converting traditional IRA or 401(k) funds to Roth versions. This is hugely advantageous, but sadly OT for this discussion. If this applies to you, the main thing to remember: you have to do the conversion for the tax year you take delivery of the car. I *think* you have until the later of April 15 or the date you file your return for the prior year to do this, but if it were me, I would do it by December 31--of the year I take delivery of the car (technically "place the car in service").
Don't have any IRAs? if you still need additional tax liability, you can try to push income into year you take delivery or push deductions out of that year, both of which will increase your tax liability. This is easy if you're self-employed or own a business, somewhat difficult if you don't. If you own a home, you can push one monthly mortgage payment into a different year (January's payment into December, or vice versa) probably without penalty, and in Texas you can pay your annual property tax payment in either December or January without penalty--choosing the year to increase your tax liability. You can also bunch up your charitable contributions outside of the year you take delivery.
"Tax liability" means the amount of tax you owe for the year. It is not equal to your withholding, your refund, etc. Look at last year's tax return, and imagine if your tax situation is equivalent for the year you'll take delivery of the Tesla.
Please correct me if I'm wrong.


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## MelindaV (Apr 2, 2016)

SoFlaModel3 said:


> To be 100% on this it would be when you "complete paperwork". Whether you pickup the car or not is ultimately irrelevant. I don't know that Tesla wants to hold the car after it's yours though outside of servicing it.


think we are saying the same thing.


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## Dr. J (Sep 1, 2017)

I won a trophy!


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## Patronus (Sep 23, 2017)

The credit is taken based on the date placed in service and has nothing to do with when you pay. I am taking a credit this year for a Bolt EV that was paid for in 2016, but delivered the first week of 2017. How I determined that was to look at the tax form. You can look for yourself here - line 3 on this form: https://www.irs.gov/pub/irs-pdf/f8936.pdf


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## SoFlaModel3 (Apr 15, 2017)

Dr. J said:


> Let's recap:
> 
> The $7,500 EV tax credit for Tesla models will be available (assuming no relevant change in tax law) through the calendar quarter in which 200,000 units are sold, and then for one more quarter. The credit will be half of that for the next two quarters. If Tesla can hold off selling that 200,000th US unit until January 2018 (which I believe it can w/o pissing off anyone), the max credit is available currently and through June 30, 2018, and the half credit is available for July 1-December 31, 2018. I believe it halves again (under current law) for the following six months, but if you're planning that far in advance, I wouldn't bet either way on what tax law looks like in 2019.
> The credit is a dollar for dollar reduction in tax liability. If between withholding and the credit you've "paid" more than your tax liability, you can request a tax refund for the difference.
> ...


Yes you are correct and also correct in that if car 200k were sold in January '18 then an $1,875 credit would be available January 1, 2019 through June 30, 2019. As of July 1, 2019 the credit would be gone (assuming no changes).


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## JohnnieB (Sep 20, 2017)

Please correct me if I'm wrong but I don't think how much you have your employer withhold has any bearing whatsoever on your tax liability. Let's say you had $50000 withheld by your employer but you only owed Uncle Sam $30000. You would be refunded the $20000 you overpaid PLUS the $7500 correct? I have heard people saying they lowered their withholding but that won't do a thing if I understand basic taxes.


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## JWardell (May 9, 2016)

Johnnie Buttelwerth said:


> Please correct me if I'm wrong but I don't think how much you have your employer withhold has any bearing whatsoever on your tax liability. Let's say you had $50000 withheld by your employer but you only owed Uncle Sam $30000. You would be refunded the $20000 you overpaid PLUS the $7500 correct? I have heard people saying they lowered their withholding but that won't do a thing if I understand basic taxes.


Lowering your withholding doesn't change your liability. But it allows you to pay 7500 less over the course of the year, instead of waiting till the next year and getting a rebate.


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## Bokonon (Apr 13, 2017)

Johnnie Buttelwerth said:


> Please correct me if I'm wrong but I don't think how much you have your employer withhold has any bearing whatsoever on your tax liability. Let's say you had $50000 withheld by your employer but you only owed Uncle Sam $30000. You would be refunded the $20000 you overpaid PLUS the $7500 correct? I have heard people saying they lowered their withholding but that won't do a thing if I understand basic taxes.


That's correct -- your withholdings do not factor into the equation.

People who are talking about lowering their withholding are likely doing so because they expect to owe less than $7500 to the IRS at the end of the year, and thus can effectively realize the benefits of the credit *before* the tax year ends through reduced payroll withholding.

I'll try to flesh it out a little, with the disclaimer that I am absolutely not a CPA.

Example: Suppose your withholdings are perfectly tuned such that you will owe $0.00 on tax day. You get paid twice a month. In January 2018, you take delivery of a Model 3 and pay $35,000.

Scenario 1: You do not adjust your payroll withholdings at all in 2018. A year after taking delivery of your Model 3 (January 2019), you file your 2018 tax return, claim the $7500 credit, and receive a $7500 check from the IRS.

Scenario 2: At the beginning of 2018, you tell your employer that you'd like to withhold up to $312.50 less (or $7500 / 24 pay periods) less from each paycheck***. Your twice-monthly paycheck increases by $312.50, which you can immediately funnel into your car payment/savings/investments, and at the end of the year, you owe the IRS $7500. On January 1st, 2019, you change your withholdings back to what they were before (!), file your 2018 taxes while claiming the $7500 credit, and your tax bill nets out to $0.00, just like it normally does.

*** You might need to do some calculations on your allowances to figure out which specific changes to make, and what your risk is for incurring an under-withholding penalty by making those changes... *especially* if your Model 3 delivery timeline slips, or if the availability of the tax credit changes unexpectedly. Again... I'm not a CPA. 

Personally, I'm not going to make any changes to my withholdings, due to the above-mentioned risks outweighing the benefits with respect to my particular financial situation and anticipated delivery timeline.


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## SoFlaModel3 (Apr 15, 2017)

My car is in the November 17 - January 18 range. If I get the car in January then I will adjust my withholdings to take home an additional $288.46 on my bi-monthly paycheck ($7,500 / 26). 

Of course this plan is because I have a tax liability in excess of $7,500 and do not want to wait to collect the “credit” in April 2019.


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## JohnnieB (Sep 20, 2017)

JWardell said:


> Lowering your withholding doesn't change your liability. But it allows you to pay 7500 less over the course of the year, instead of waiting till the next year and getting a rebate.


Thank you!


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## JohnnieB (Sep 20, 2017)

Johnnie Buttelwerth said:


> Please correct me if I'm wrong but I don't think how much you have your employer withhold has any bearing whatsoever on your tax liability. Let's say you had $50000 withheld by your employer but you only owed Uncle Sam $30000. You would be refunded the $20000 you overpaid PLUS the $7500 correct? I have heard people saying they lowered their withholding but that won't do a thing if I understand basic taxes.


Thank you to everyone who chimed in and provided some great examples and details!


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## samson (Mar 8, 2017)

SoFlaModel3 said:


> My car is in the November 17 - January 18 range. If I get the car in January then I will adjust my withholdings to take home an additional $288.46 on my bi-monthly paycheck ($7,500 / 26).
> 
> Of course this plan is because I have a tax liability in excess of $7,500 and do not want to wait to collect the "credit" in April 2019.


Can you still get the $7500 Tax credit, if you had to sell you car in say 8 months after you purchase in Jan 2018?


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## SoFlaModel3 (Apr 15, 2017)

samson said:


> Can you still get the $7500 Tax credit, if you had to sell you car in say 8 months after you purchase in Jan 2018?


That is something I am not 100% on. Buying the car for the purpose of resale precludes you from the credit, but having to sell I'm not sure.

I know with the first time home buyer credit from years ago you had to keep the home for a few years otherwise you would need to pay back the credit. I'd have to reread the tax code to check to see specifically what the provision says.


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## Dr. J (Sep 1, 2017)

samson said:


> Can you still get the $7500 Tax credit, if you had to sell you car in say 8 months after you purchase in Jan 2018?


"The vehicles must be acquired for use or lease and not for resale. Additionally, the original use of the vehicle must commence with the taxpayer and the vehicle must be used predominantly in the United States. For purposes of the 30D credit, a vehicle is not considered acquired prior to the time when title to the vehicle passes to the taxpayer under state law."
Source: https://www.irs.gov/businesses/plug-in-electric-vehicle-credit-irc-30-and-irc-30d

"Acquired for resale"--what does that mean? *Probably *it means this:

Property is considered acquired for resale if it is described in § 1221(a)(1). Section 1221(a)(1) describes "property held by the taxpayer primarily for sale to customers in the ordinary course of his trade or business."
Source: https://www.irs.gov/pub/irs-lafa/20123201F.pdf

If I were in your shoes, my concern would be whether the tax form on which you claim the credit asks whether you still own the car: Form 8936, found here: https://www.irs.gov/pub/irs-pdf/f8936.pdf. Instructions are here: https://www.irs.gov/pub/irs-pdf/i8936.pdf. It says further:

"The following requirements must be met to qualify for the credit. You are the owner of the vehicle. If the vehicle is leased, only the lessor and not the lessee, is entitled to the credit. You placed the vehicle in service during your tax year. The vehicle is manufactured primarily for use on public streets, roads, and highways. The original use of the vehicle began with you. You acquired the vehicle for use or to lease to others, and not for resale. You use the vehicle primarily in the United States."

I advise you ask a knowledgeable tax expert about the "acquired for resale" clause.


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## SoFlaModel3 (Apr 15, 2017)

Dr. J said:


> "The vehicles must be acquired for use or lease and not for resale. Additionally, the original use of the vehicle must commence with the taxpayer and the vehicle must be used predominantly in the United States. For purposes of the 30D credit, a vehicle is not considered acquired prior to the time when title to the vehicle passes to the taxpayer under state law."
> Source: https://www.irs.gov/businesses/plug-in-electric-vehicle-credit-irc-30-and-irc-30d
> 
> "Acquired for resale"--what does that mean? *Probably *it means this:
> ...


Definitely vague and could come down to interpretation. Those looking to flip the car would clearly be resellers. Someone holding the car for 8 months... hard to say.


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## samson (Mar 8, 2017)

SoFlaModel3 said:


> Definitely vague and could come down to interpretation. Those looking to flip the car would clearly be resellers. Someone holding the car for 8 months... hard to say.


The reason 8 months is when the AWD comes out and I want to switch over to AWD instead of keeping the RWD model 3.

@TrevP @MelindaV @KennethK @Kennethbokor , Would I qualify for whatever tax credit that exists for both cars at that time provided I owe the IRS more than $15K.
I know going this route would mean I have to take some big losses rather than just waiting. Just exploring options Thanks


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## SoFlaModel3 (Apr 15, 2017)

samson said:


> The reason 8 months is when the AWD comes out and I want to switch over to AWD instead of keeping the RWD model 3.


Interesting!

Do you have 2 reservations?

See I don't think the intent behind the credit would be for you to get $15,000 in tax credits in one year and end up with 1 car.

Of course the intended purpose and poor writing of the tax law are 2 different stories


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## samson (Mar 8, 2017)

SoFlaModel3 said:


> Interesting!
> 
> Do you have 2 reservations?
> 
> ...


Well there would be losses associated with selling the 1st car and only 1/2 if lucky of tax credit on the second. So realistically would be less but sure one could always hope for the best.


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## MelindaV (Apr 2, 2016)

I would be worried if an audit came up and it showed you no Longer owned the first by the time you filed the return. That I can see being argued by an IRS auditor as you flipping the first but taking the credit for both.


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## SoFlaModel3 (Apr 15, 2017)

samson said:


> Well there would be losses associated with selling the 1st car and only 1/2 if lucky of tax credit on the second. So realistically would be less but sure one could always hope for the best.


Ahh yes, I forgot the credit should be $3,750 the second time around in 8 months.

As for losses, we don't know yet. If the car still has a 1 year backlog in 8 months you may not take a loss on that sale of the first car.


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## garsh (Apr 4, 2016)

MelindaV said:


> I would be worried if an audit came up and it showed you no Longer owned the first by the time you filed the return. That I can see being argued by an IRS auditor as you flipping the first but taking the credit for both.


I think he would be fine.

He's actually using the car for personal use for 8 months. It's going to definitely be considered a "used" car when he goes to sell it. There's no stipulation about how long you have to hang onto a car. I think he's in the clear with that plan.

Edit: IANAL, IANAFC, enter at your own risk, do not taunt happy fun ball, etc.


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## Brokedoc (May 28, 2017)

For argument's sake, if someone were to buy an EV and get into a major accident driving off the lot so that the car were totaled, I believe that they would still qualify for the credit. Also if someone bought an EV and absolutely hated the way it drove and then sold it or traded it in, they would also qualify for the credit. The wording of the law seems very squishy and revolves around the intent of the purchase with no fixed minimum length of time of ownership.


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## SoFlaModel3 (Apr 15, 2017)

Brokedoc said:


> For argument's sake, if someone were to buy an EV and get into a major accident driving off the lot so that the car were totaled, I believe that they would still qualify for the credit. Also if someone bought an EV and absolutely hated the way it drove and then sold it or traded it in, they would also qualify for the credit. The wording of the law seems very squishy and revolves around the intent of the purchase with no fixed minimum length of time of ownership.


I would slightly challenge this - again I think the wording is ultimately poor on the tax law though.

Buying the car and totaling it. You didn't resell it, so I believe you'd be in the clear to qualify for the credit.

Buying the car, hating it after a week, and selling it. That is very much so in the gray area to me. Personally if it was me I wouldn't claim the credit from a moral standpoint.


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## garsh (Apr 4, 2016)

SoFlaModel3 said:


> Buying the car, hating it after a week, and selling it. That is very much so in the gray area to me.


I think 8 months is well out of the gray area.


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## Brokedoc (May 28, 2017)

Resale generally infers that the person flipping makes a profit. Although it's conceivable someone profits from flipping an early delivery Model 3 because of the long waiting list, after you back out the taxes paid and depreciation, it's would be hard for anyone to prove that his original intent was reselling given that he would likely lose money after holding the car for 8 months.


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## Dr. J (Sep 1, 2017)

Brokedoc said:


> Resale generally infers that the person flipping makes a profit. Although it's conceivable someone profits from flipping an early delivery Model 3 because of the long waiting list, after you back out the taxes paid and depreciation, it's would be hard for anyone to prove that his original intent was reselling given that he would likely lose money after holding the car for 8 months.


"Purchased for resale" generally means someone is operating a car dealer business. I think this question has a black and white answer....but I was waiting on someone else to provide it.


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## Akilae (Jan 16, 2017)

I'd say... calm "the f..." down everybody .

https://electrek.co/2017/10/05/tesla-model3-buyers-access-federal-tax-credits-2018/


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## SoFlaModel3 (Apr 15, 2017)

Akilae said:


> I'd say... calm "the f..." down everybody .
> 
> https://electrek.co/2017/10/05/tesla-model3-buyers-access-federal-tax-credits-2018/


I disagree with this article. I don't see any way that car 200,000 in the US is held into Q2 2018. There is really just no way. They are ~60,000 from the threshold. How would they possibly not deliver 60,000 cars between now and March 31, 2018? No way when you factor S/X/3 sales. It happens in Q1 for sure or there are severe ramp up issues.

Count on it!


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## MelindaV (Apr 2, 2016)

Yeah, elecktrek took the thought that tesla would hold deliveries for a week to deliver in the next quarter to the extreme and seems to think that means they would old cars ready in January for March delivery. No way that would happen. A week, yeah probably. A couple months, not a chance.


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## Rich M (Jul 28, 2017)

So the credit is good for the first 200,000 EVs from any manufacturer. Does that include all brands under the same manufacturer like Volkswagen/Audi/Porsche?

What about buyouts if (example) BMW bought Tesla do they add up the total EVs sold?

What if Elon put on a fake moustache and changed the company name to Smesla Motors. Would the count start at 0?


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## SoFlaModel3 (Apr 15, 2017)

Rich M said:


> So the credit is good for the first 200,000 EVs from any manufacturer. Does that include all brands under the same manufacturer like Volkswagen/Audi/Porsche?
> 
> What about buyouts if (example) BMW bought Tesla do they add up the total EVs sold?
> 
> What if Elon put on a fake moustache and changed the company name to Smesla Motors. Would the count start at 0?


I'm not sure on the "brands" question, but the 200,000 number represents the start of the phase out period and only applies to domestic sales of qualifying cars.

Once the manufacturer hits 200,000, the rest of that calendar quarter and the next quarter can earn the full credit. Then 2 calendar quarters at 50%, and finally 2 calendar quarters at 25%.

For a practical example, if Tesla sells domestic car 200,000 in Q1 2018, then the credit looks like this...

$7,500 runs through 6/30/2018
$3,750 runs 7/1/2018 through 12/31/2018
$1,875 runs 1/1/2019 through 6/30/2019
No credit available beginning 7/1/2019


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## MelindaV (Apr 2, 2016)

Rich M said:


> So the credit is good for the first 200,000 EVs from any manufacturer. Does that include all brands under the same manufacturer like Volkswagen/Audi/Porsche?
> 
> What about buyouts if (example) BMW bought Tesla do they add up the total EVs sold?
> 
> What if Elon put on a fake moustache and changed the company name to Smesla Motors. Would the count start at 0?


the IRS language reads as "This tax credit will be available until 200,000 qualified EVs have been sold in the United States by each manufacturer, at which point the credit begins to phase out for that manufacturer."
not sure how they define manufacturer though.

ETA: They do however seem to lump Smart under Mercedes and Cooper under BMW... so that would lead me to believe it is the parent company, not the brand. 
quarterly sales (ford, Merc, BMW only shown)


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## Grashelm (Aug 4, 2017)

SoFlaModel3 said:


> I disagree with this article. I don't see any way that car 200,000 in the US is held into Q2 2018. There is really just no way. They are ~60,000 from the threshold. How would they possibly not deliver 60,000 cars between now and March 31, 2018? No way when you factor S/X/3 sales. It happens in Q1 for sure or there are severe ramp up issues.
> 
> Count on it!


Yeah but you also have to factor in if they do deliver 60,000 cars by end Q1, they won't all be delivered in the US (S & X).


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## SoFlaModel3 (Apr 15, 2017)

Grashelm said:


> Yeah but you also have to factor in if they do deliver 60,000 cars by end Q1, they won't all be delivered in the US (S & X).


So being conservative, it feels safe saying another 20,000 domestic deliveries of S/X by year end.

That brings us to 160,000 (40,000 to go).

Now let's say they produce and deliver 20,000 Model 3's in Q4. I think it will be more, but for the sake of a simple look...

That brings us to 180,000 (20,000 to go).

Now we're in Q1 -- if they can't produce and deliver 20,000 domestic cars across S/X/3 something is seriously wrong. They should be able to deliver 60,000 Model 3's and say another 20,000 Model S/X. Even if they fall short in Q4 again, I don't see how they don't hit in Q1...


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## BoRidge (Sep 14, 2017)

Rich M said:


> So the credit is good for the first 200,000 EVs from any manufacturer. Does that include all brands under the same manufacturer like Volkswagen/Audi/Porsche?
> 
> What about buyouts if (example) BMW bought Tesla do they add up the total EVs sold?
> 
> What if Elon put on a fake moustache and changed the company name to Smesla Motors. Would the count start at 0?


Wait a minute, are you saying it was a good thing or bad thing that I gave $1,000 to that guy wearing a mustache from Smesla?


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## Grashelm (Aug 4, 2017)

SoFlaModel3 said:


> I don't see how they don't hit in Q1...


Maybe something like this?

Source: "Pilot" Model 3 Body Line Still In Development Near Detroit - DailyKanban

I have no opinion on the veracity of the article or it's implications if true, but I'm a firm believer in the old axiom "Anything can happen"!


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## SoFlaModel3 (Apr 15, 2017)

Grashelm said:


> Maybe something like this?
> 
> Source: "Pilot" Model 3 Body Line Still In Development Near Detroit - DailyKanban
> 
> I have no opinion on the veracity of the article or it's implications if true, but I'm a firm believer in the old axiom "Anything can happen"!


The thing is that even if Model 3 production limps steady demand in S/X all but gets them there in Q1 and if Model 3 limps through end of Q1 there are bigger concerns than the federal tax credit phase out.


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## jsmay311 (Oct 2, 2017)

SoFlaModel3 said:


> So _*being conservative*_, it feels safe saying another 20,000 domestic deliveries of S/X by year end.


Huh??

Per https://insideevs.com/monthly-plug-in-sales-scorecard/, Tesla has never delivered more than 15,000 vehicles domestically in any quarter.

I wouldn't say 20,000 S/X's in the US in Q4 isn't doable, but I wouldn't call it conservative.


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## SoFlaModel3 (Apr 15, 2017)

jsmay311 said:


> Huh??
> 
> Per https://insideevs.com/monthly-plug-in-sales-scorecard/, Tesla has never delivered more than 15,000 vehicles domestically in any quarter.
> 
> I wouldn't say 20,000 S/X's in the US in Q4 isn't doable, but I wouldn't call it conservative.


I could have sworn they sold more than 20,000 domestically this past quarter. Either I read wrong of Inside EVs is not accurate. Need to go back and check where I got my number.


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## MelindaV (Apr 2, 2016)

SoFlaModel3 said:


> I could have sworn they sold more than 20,000 domestically this past quarter. Either I read wrong of Inside EVs is not accurate. Need to go back and check where I got my number.


Total deliveries was 26,150, including international.


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## kmngq (Aug 27, 2017)

SoFlaModel3 said:


> The thing is that even if Model 3 production limps steady demand in S/X all but gets them there in Q1 and if Model 3 limps through end of Q1 there are bigger concerns than the federal tax credit phase out.


THIS!
yes the 200k car sold date is pushed back, but so is the overall queue.

where you were in line when you reserved is where you are in the line currently. you arent magically moved up.

say you are reservationist #150,000. just because tesla might hit 200,000 later in the year, doesnt mean youre now reservation #100,000. youre still at #150,000, and 149,999 people are still before you. If anything, the slower the model 3 ramp up takes place, the less model 3s will get full rebate. the more model s/x will be sold. so the slow production rate of model 3 is not good for people waiting for full rebate.

however there is one caveat to this.

late reservationist can hope to ride the ramp up wave, for the wind down quarter for full $7500. and it better be a huge wave.


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## SoFlaModel3 (Apr 15, 2017)

kmngq said:


> THIS!
> yes the 200k car sold date is pushed back, but so is the overall queue.
> 
> where you were in line when you reserved is where you are in the line currently. you arent magically moved up.
> ...


The whole "how many Model 3's get the full $7,500" is all about timing of the 200k hit and where Model 3 production is at the time of the hit.

So just thinking out loud again...

Let's say 20,000 Model 3's are delivered this year -- hopefully more.
In Q1 2018 60,000 Model 3's are delivered
In Q2 2018 60,000 Model 3's are delivered

Assuming Tesla hits 200k domestic cars in Q1 2018 then 140,000 Model 3's will get the full credit. That's essentially all domestic day 1 reservations that want first production. I would say that's phenomenal! Probably most all day 1 domestic reservations that want standard battery can even get the full credit since it should run to 6/30/2018.


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## Dr. J (Sep 1, 2017)

SoFlaModel3 said:


> Let's say 20,000 Model 3's are delivered this year -- hopefully more.
> In Q1 2018 60,000 Model 3's are delivered
> In Q2 2018 60,000 Model 3's are delivered


That sounds about right. Sounds like we need a poll!


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## Grashelm (Aug 4, 2017)

SoFlaModel3 said:


> The whole "how many Model 3's get the full $7,500" is all about timing of the 200k hit and where Model 3 production is at the time of the hit.
> 
> So just thinking out loud again...
> 
> ...


After Elon's tweestorm today, I am even more inclined to believe that 200K US deliveries will not occur until Q2. I might be wrong, but then again....


__ https://twitter.com/i/web/status/916407361899708416


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## SoFlaModel3 (Apr 15, 2017)

Grashelm said:


> After Elon's tweestorm today, I am even more inclined to believe that 200K US deliveries will not occur until Q2. I might be wrong, but then again....
> 
> 
> __ https://twitter.com/i/web/status/916407361899708416


I suppose it's possible at this point, but I'm still betting on it happening in Q1.


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## tivoboy (Mar 24, 2017)

MelindaV said:


> the IRS language reads as "This tax credit will be available until 200,000 qualified EVs have been sold in the United States by each manufacturer, at which point the credit begins to phase out for that manufacturer."
> not sure how they define manufacturer though.
> 
> ETA: They do however seem to lump Smart under Mercedes and Cooper under BMW... so that would lead me to believe it is the parent company, not the brand.
> quarterly sales (ford, Merc, BMW only shown)


technically, it's the "manufacturer", so brands and models all get lumped in together.. Mercedes is probably listed as the manufacturer for smart, and BMW is listed for Mini.


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## Troy (Sep 18, 2017)

Hi, everybody. Here is the latest situation regarding the federal tax credits:

*Pessimistic Scenario* (50% likely)

$7,500 for deliveries until Jun 30, 2018
$3,750 for deliveries until Dec 31, 2018
$1,875 for deliveries until Jun 30, 2019
*Optimistic Scenario* (50% likely)

$7,500 for deliveries until Sep 30, 2018
$3,750 for deliveries until Mar 31, 2019
$1,875 for deliveries until Sep 30, 2019
As of today, I'm calculating 147,502 USA sales and I would expect Tesla to hit 200,000 USA sales in late March 2018. That would be the pessimistic scenario. In other words, if they hit 200K in Q1 2018, full credits will continue until the end of Q2 2018. Of course, if they push the 200K day to Q2 2018, then full credits will continue until the end of Q3 2018. This would be the optimistic scenario. We will find out more when they have the conference call at the end of this month.

By the way, Tesla does not regularly release their USA sales numbers. Therefore some people might think that none of the USA numbers were released by Tesla but that's not the case. 2014, 2015 and Q3 2016 USA numbers were released by Tesla. I use those in calculations. Also, Tesla's California delivery numbers are published by the dealer association CNCDA.org. I use those as well. You can see the spreadsheet here. If you scroll all the way to the right, you can see the latest info on federal tax credits. Cheers


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## Frank99 (Aug 3, 2017)

Not much faith in Tesla making 5000 Model 3's a week? Doesn't look like your predicting that even in Q2 2018.


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## SoFlaModel3 (Apr 15, 2017)

Troy said:


> Hi, everybody. Here is the latest situation regarding the federal tax credits:
> 
> *Pessimistic Scenario* (50% likely)
> 
> ...


Honesty unless Model 3 completely fails they will be close to 200k by end of Q1 with S/X alone...


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## Troy (Sep 18, 2017)

Hi, @Frank99. Yes besides a delayed S curve, I also expect it to be less steep. However, for federal tax credit purposes, only Q4 2017 and Q1 2018 matter. I expect around 4K Model 3s in Q4 2017 and 26K in Q1 2018.

@SoFlaModel3, I'm calculating 144,745 USA sales at the end of Q3 2017. We need to add two more quarters. S and X sales are around 24,000 per quarter globally and 12,500 in the USA. Therefore they should end up around 145+25= 170,000 at the end of Q1 2018 with just S and X.

You can check the USA sales numbers I'm using here in column O. The numbers in yellow are estimates. The numbers in green were published by Tesla.


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## SoFlaModel3 (Apr 15, 2017)

Troy said:


> Hi, @Frank99. Yes besides a delayed S curve, I also expect it to be less steep. However, for federal tax credit purposes, only Q4 2017 and Q1 2018 matter. I expect around 4K Model 3s in Q4 2017 and 26K in Q1 2018.
> 
> @SoFlaModel3, I'm calculating 144,745 USA sales at the end of Q3 2017. We need to add two more quarters. S and X sales are around 24,000 per quarter globally and 12,500 in the USA. Therefore they should end up around 145+25= 170,000 at the end of Q1 2018 with just S and X.
> 
> You can check the USA sales numbers I'm using here in column O. The numbers in yellow are estimates. The numbers in green were published by Tesla.


I think US sales will be higher in Q4 and Q1, but going with your numbers, you don't think Tesla will deliver 30,000 Model 3's in the next 2 quarters? If they get half way to their goal and produce 2,500 a week. Say 1,000/week average for the rest of this year and 2,500/week for Q1. That would be (1,000 * 12) + (2,500 * 12) = 42,000. That means 212,000 by 3/31/2018. I am quite hopeful that they reach their production goals thus blowing the doors off of 200,000 in Q1.


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## MelindaV (Apr 2, 2016)

Per insideevs, tesla delivered 14,780 US Model S and X this last quarter. Generally speaking all manufacturers sell the most in Q4 (Tesla’s numbers last year were about equal between Q3 and Q4 with the huge push to sell in Q3 prior to the AP2 release) so expect using 12k S and X deliveries as a standard for the next two months will be low.


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## Troy (Sep 18, 2017)

Hi, @MelindaV. InsideEVs YTD estimates are 19,630 Model S and 15,290 Model X. Source. That's 34,920 units at the end of Q3 2017. I'm estimating 38,390 units. See the 2017 USA numbers in column O here. In other words, I estimate higher USA numbers than insideEVs, not lower. However, I agree that the next two quarters could be around 13K. I have now adjusted those numbers and it shows 25 March 2018 for the 200K day instead of 28 March.

I think Model 3 estimates are more important than S+X. There is about 28,000 units gap. Will Tesla make 28,000 Model 3s in the next two quarters? That's the question. My guess is, the number will be close to 30,000. Therefore it is a close call at this time. I will update my estimates after the conference call at the end of this month.


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## SoFlaModel3 (Apr 15, 2017)

Troy said:


> Hi, @MelindaV. InsideEVs YTD estimates are 19,630 Model S and 15,290 Model X. Source. That's 34,920 units at the end of Q3 2017. I'm estimating 38,390 units. See the 2017 USA numbers in column O here. In other words, I estimate higher USA numbers than insideEVs, not lower. However, I agree that the next two quarters could be around 13K. I have now adjusted those numbers and it shows 25 March 2018 for the 200K day instead of 28 March.
> 
> I think Model 3 estimates are more important than S+X. There is about 28,000 units gap. Will Tesla make 28,000 Model 3s in the next two quarters? That's the question. My guess is, the number will be close to 30,000. Therefore it is a close call at this time. I will update my estimates after the conference call at the end of this month.


I get that there is an issue with production right now but I would be stunned if they didn't produce 50k+ Model 3's by 3/31/2018.

Their goal is 60k in 1Q 2018 alone not counting what they accomplish this year still...

We know they are slightly behind on the ramp, but once they hit 5k/week it's not going back the other direction.


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## Reef Club (Jun 18, 2017)

I see this as a Half full, not a half empty glass. Upside of a delay is that we could be on AP3; additional sensors/cameras and free Supercharging thrown in for being patient.


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## Grashelm (Aug 4, 2017)

Troy said:


> Hi, @MelindaV. InsideEVs YTD estimates are 19,630 Model S and 15,290 Model X. Source. That's 34,920 units at the end of Q3 2017. I'm estimating 38,390 units. See the 2017 USA numbers in column O here. In other words, I estimate higher USA numbers than insideEVs, not lower. However, I agree that the next two quarters could be around 13K. I have now adjusted those numbers and it shows 25 March 2018 for the 200K day instead of 28 March.
> 
> I think Model 3 estimates are more important than S+X. There is about 28,000 units gap. Will Tesla make 28,000 Model 3s in the next two quarters? That's the question. My guess is, the number will be close to 30,000. Therefore it is a close call at this time. I will update my estimates after the conference call at the end of this month.


I can't imagine they would let it hit 200K in the last few days of the quarter?? Believe they've always stated that the goal is to afford the greatest number of reservation holders the opportunity for the full $7500 tax credit. Hitting that number on the 25th-28th is basically a waste of a quarter no?


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## Grashelm (Aug 4, 2017)

Reef Club said:


> I see this as a Half full, not a half empty glass. Upside of a delay is that we could be on AP3; additional sensors/cameras and free Supercharging thrown in for being patient.


All good points but irrelevant to the topic of this post.


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## VATesla4Me (Oct 8, 2017)

SoFlaModel3 said:


> I get that there is an issue with production right now but I would be stunned if they didn't produce 50k+ Model 3's by 3/31/2018.
> 
> Their goal is 60k in 1Q 2018 alone not counting what they accomplish this year still...
> 
> We know they are slightly behind on the ramp, but once they hit 5k/week it's not going back the other direction.


It is possible that after hitting 5k per week that they need to slow production down for an issue (not too likely by then) or to support robot tooling adjustments for additional configurations. Either way from a car purchase perspective - I say patience will be key/ from an investment perspective (not this forum) there is completely different set of views/ perspectives. I hope TESLA resolves the ramp issues quickly and they are able to ramp production quickly as this works to help us as buyers and support TESLA investment.


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## Dr. J (Sep 1, 2017)

Grashelm said:


> I can't imagine they would let it hit 200K in the last few days of the quarter?? Believe they've always stated that the goal is to afford the greatest number of reservation holders the opportunity for the full $7500 tax credit. Hitting that number on the 25th-28th is basically a waste of a quarter no?


My guess: if Tesla is within a week of quarter-end hitting 200,000 deliveries, they would find a way to delay deliveries past the end of the quarter to optimize the number of happy customers. However, Musk is certainly not going to talk about THAT until March at the earliest. His psychology seems to be magical realism (if not outright magical thinking) to push people to achieve.


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## SoFlaModel3 (Apr 15, 2017)

Grashelm said:


> I can't imagine they would let it hit 200K in the last few days of the quarter?? Believe they've always stated that the goal is to afford the greatest number of reservation holders the opportunity for the full $7500 tax credit. Hitting that number on the 25th-28th is basically a waste of a quarter no?


I agree, but the point I'm making is that they're hitting 200k well before the end of Q1.


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## Gordon Tyler (Sep 17, 2016)

There is no reason to slow down production in order to hit the magic 200k number at the start of a quarter. They can just ship cars to Canada instead. The 200k number is the number of cars delivered in the US and is solely for the US federal rebate rules. We will still get the $7500 for that and the next quarter then $3750 for the following two quarters. Looks like that means Q2 2018 and Q3 2018 are good for the full rebate.


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## SoFlaModel3 (Apr 15, 2017)

Gordon Tyler said:


> There is no reason to slow down production in order to hit the magic 200k number at the start of a quarter. They can just ship cars to Canada instead. The 200k number is the number of cars delivered in the US and is solely for the US federal rebate rules. We will still get the $7500 for that and the next quarter then $3750 for the following two quarters. Looks like that means Q2 2018 and Q3 2018 are good for the full rebate.


I still think it's a moot point because they're hitting early to mid Q2.

Also a bad look for Tesla being an American company to already be delayed and then add to the delay on domestic deliveries by shipping international.

Just my $0.02.


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## MelindaV (Apr 2, 2016)

SoFlaModel3 said:


> I still think it's a moot point because they're hitting early to mid Q2.


presume you meant early to mid Q1, or have some of the others swayed your persistence?


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## SoFlaModel3 (Apr 15, 2017)

MelindaV said:


> presume you meant early to mid Q1, or have some of the others swayed your persistence?


Ahhh!!! 

Yes, it's a lock and put it in the bank -- this happens in Q1 and the $7,500 portion of the credit ends 6/30/2018.

If I'm wrong -- sure the credit last longer, but there will be thousands upon thousands of highly disappointed customers.


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## garsh (Apr 4, 2016)

SoFlaModel3 said:


> If I'm wrong -- sure the credit last longer, but there will be thousands upon thousands of highly disappointed customers.


Yep, some people haven't caught on to the fact that delaying the production will result in fewer people getting the rebate, not more.

Worse, if Tesla can't get the Model 3 production line operating at high speed within a reasonable timeframe, they'll probably need more funding to survive. They've borrowed money like crazy to get production going quickly. So let's hope they get the issues solved within the next few weeks.


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## SoFlaModel3 (Apr 15, 2017)

garsh said:


> Yep, some people haven't caught on to the fact that delaying the production will result in fewer people getting the rebate, not more.
> 
> Worse, if Tesla can't get the Model 3 production line operating at high speed within a reasonable timeframe, they'll probably need more funding to survive. They've borrowed money like crazy to get production going quickly. So let's hope they get the issues solved within the next few weeks.


Very well said!

Getting production up to speed literally means every US consumer with a reservation right now gets at least some part of the credit and 100,000-140,000 getting the full $7,500. There is no worry about "the right thing" at the end of a quarter. The right thing is making it happen.


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## danzgator (May 17, 2017)

I'm not trying to get political here, but looking at the current administration's actions so far regarding anything green, it would seem that they would not extend the tax credit. However, the administration also is also protectionist of US corps and keeping jobs in the US. Since Tesla and GM will be the first to reach 200k (+/-Q1-Q2 2018)* and the tax credit phase out, not extending the tax credit gives a competitive advantage to Nissan (+/-Q1 2019), Toyota (+/-Q1 2020), and BMW (+/-Q1 2020) on selling EV's in the US. Therefore, in order to protect US corps and US jobs, I'd think the administration would either need to extend the tax credit, or get rid of it for all. Thoughts? 

*Phase out dates by InsideEV's.


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## garsh (Apr 4, 2016)

danzgator said:


> I'm not trying to get political here, but looking at the current administration's actions so far regarding anything green, it would seem that they would not extend the tax credit.


GM, Ford, et al will want to keep the credit because it will help them compete after Tesla has already reached their limit. I wouldn't worry about the credit disappearing.

Once GM and Ford have hit their limits, _then_ I would expect a push to revoke the credit to prevent foreign companies from using it to their advantage against the domestics. It will be several more years before we get to that point.


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## danzgator (May 17, 2017)

garsh said:


> GM, Ford, et al will want to keep the credit because it will help them compete after Tesla has already reached their limit. I wouldn't worry about the credit disappearing.
> 
> Once GM and Ford have hit their limits, _then_ I would expect a push to revoke the credit to prevent foreign companies from using it to their advantage against the domestics. It will be several more years before we get to that point.


I think you glossed over the quarters in my post. Tesla and GM are expected to hit 200k in the first half of 2018, so your 'several years' is inaccurate. Ford, won't hit until +/-Q2 2019, but if you wait that long to do anything about the credit, you've already given a competitive advantage to Nissan/Toyota/BMW. Below forecasts from InsideEV's should still be +/- accurate, except InsideEV's has since updated its Tesla phase out to begin Q1 2018.


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## Model34mePlease (Jun 3, 2017)

danzgator said:


> I think you glossed over the quarters in my post. Tesla and GM are expected to hit 200k in the first half of 2018, so your 'several years' is inaccurate. Ford, won't hit until +/-Q2 2019, but if you wait that long to do anything about the credit, you've already given a competitive advantage to Nissan/Toyota/BMW. Below forecasts from InsideEV's should still be +/- accurate, except InsideEV's has since updated its Tesla phase out to begin Q1 2018.


I largely agree, but that chart is old and probably 1 quarter optimistic for GM and 1 quarter pessimistic for Tesla. Also, If that is really the shipment rates for the others, it is largely a 'who cares'? Tesla is going to blow the socks off the numbers for everybody. Even GM is largely done. The Bolt is selling countrywide and is probably maxed out at 30,000/yr. Even if Tesla has a slow ramp on the Model 3, by the end of 2018, their numbers (in the US) should probably be almost the sum of all the others and the shipment rate maybe 3 or 4 times the sum of the rest.


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## tivoboy (Mar 24, 2017)

danzgator said:


> I think you glossed over the quarters in my post. Tesla and GM are expected to hit 200k in the first half of 2018, so your 'several years' is inaccurate. Ford, won't hit until +/-Q2 2019, but if you wait that long to do anything about the credit, you've already given a competitive advantage to Nissan/Toyota/BMW. Below forecasts from InsideEV's should still be +/- accurate, except InsideEV's has since updated its Tesla phase out to begin Q1 2018.


only thing I can say about this chart is that the BMW numbers for 2017 seem VERY low, there are at least 20 i3 models and another 10 i8 models within about six blocks of my house.
Also, where is Daimler? they have had many EV's, the B series and the smart for several years now, why wouldn't they have any representation?


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## Brett (Aug 1, 2017)

tivoboy said:


> there are at least 20 i3 models and another 10 i8 models within about six blocks of my house.


Yeah, but you live in smack-dab in the middle of the EV capitol of america. I'm guessing they're not as popular in Oklahoma. Still though, I commute with at least 2 i3s and 1 i8. So in CA at least there are a bunch. For reference I see at least 4-5 Teslas on that same commute.


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## RoadToLevel5 (Aug 3, 2017)

Does anyone know if there's a minimum length of ownership required to qualify for the federal tax credit?

I have two early reservations and an out-of-state family member wants to buy one from me. My first attempt will be to transfer the reservation, but if that doesn't work, I may consider reselling. I realize it will be taxed twice (GA and KS).

Thanks.


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## MelindaV (Apr 2, 2016)

RoadToLevel5 said:


> Does anyone know if there's a minimum length of ownership required to qualify for the federal tax credit?
> 
> I have two early reservations and an out-of-state family member wants to buy one from me. My first attempt will be to transfer the reservation, but if that doesn't work, I may consider reselling.



you do not qualify for the credit if it is intended for resell - the length of ownership is not a factor, but if it is premeditated, it is.


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## RoadToLevel5 (Aug 3, 2017)

MelindaV said:


> you do not qualify for the credit if it is intended for resell - the length of ownership is not a factor, but if it is premeditated, it is.


Good to know. It would amount to an unrealized tax credit then as the resale wouldn't qualify for the tax credit either.

Nonetheless, the qualification based on intent is subjective, unless you're a dealer.


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## SoFlaModel3 (Apr 15, 2017)

RoadToLevel5 said:


> Good to know. It would amount to an unrealized tax credit then as the resale wouldn't qualify for the tax credit either.
> 
> Nonetheless, the qualification based on intent is subjective, unless you're a dealer.


That's correct -- you would not get the credit, nor would your family member.

The car itself counts as a hit toward 200,000 and no one gets the credit.


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## ummgood (Feb 13, 2017)

Brett said:


> Yeah, but you live in smack-dab in the middle of the EV capitol of america. I'm guessing they're not as popular in Oklahoma. Still though, I commute with at least 2 i3s and 1 i8. So in CA at least there are a bunch. For reference I see at least 4-5 Teslas on that same commute.


I agree. I live in Austin and we have a ton of EV's here as well but the Model S and X outweigh the i3 by a landslide. I would say I now see at least 5-10 model S a day and I might be lucky if I see 1 i3 every couple weeks. I have yet to see a Bolt either but there are plenty of Volts running around.


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## Trader (Jun 13, 2017)

The new TAX Bill just released has the provision to do away with the EV Tax Credit. Telsa down $22 as I write this. IF this passes it will kill the number of Model 3 cars they sell. Pray that it comes out of the bill.


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## Rusty (Sep 9, 2017)

https://electrek.co/2017/11/02/electric-vehicle-tax-credit-expected-slashed-new-house-tax-bill/

Let's hope this doesn't happen. May help Tesla long term but very bad short term for Tesla and us.


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## mkg3 (May 25, 2017)

Trader said:


> The new TAX Bill just released has the provision to do away with the EV Tax Credit. Telsa down $22 as I write this. IF this passes it will kill the number of Model 3 cars they sell. Pray that it comes out of the bill.


It was already down close to $20/share before the news so its not a huge hit. There was a knee-jerk reaction initially but it has come off the lows.

As for "kill the number of Model 3...", vast majority of reservation holders are outside of the benefit already so I disagree with the statement. If anything, it will keep the competition on the level ground so they all have to compete on their own merit.


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## Mark C (Aug 26, 2016)

Trader said:


> The new TAX Bill just released has the provision to do away with the EV Tax Credit. Telsa down $22 as I write this. IF this passes it will kill the number of Model 3 cars they sell. Pray that it comes out of the bill.


I was hoping to get the credit, but it wasn't a deal breaker. This doesn't mean it is certain that it will be gottten rid of though, because some of the other items President Trump hoped to cut out of the budget didn't happen.

He's the President, not the King, so his desires have to filter through an awful large group of elected officials, many of whom have other manufacturers they are beholden to who will be more affected than Tesla. Let's not get too worried, the sky is not falling.


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## McHoffa (Jan 26, 2017)

mkg3 said:


> It was already down close to $20/share before the news so its not a huge hit. There was a knee-jerk reaction initially but it has come off the lows.
> 
> As for "kill the number of Model 3...", vast majority of reservation holders are outside of the benefit already so I disagree with the statement. If anything, it will keep the competition on the level ground so they all have to compete on their own merit.


Nearly all reservations holders would fall into either full tax credit (Q1/Q2) or half tax credit (Q3/Q4). That's probably 300,000+ people that this would affect, especially since almost everyone got pushed into 2018 for their Model 3.

If you don't think a HUGE number of people would cancel or postpone their purchase because of this, just look on Reddit, etc. People are already saying they would do just that. I would postpone mine if they kill the tax credit just because I would really like white interior. The only reason I was going to just settle for black was to get the full tax credit.


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## slasher016 (Sep 12, 2017)

McHoffa said:


> Nearly all reservations holders would fall into either full tax credit (Q1/Q2) or half tax credit (Q3/Q4). That's probably 300,000+ people that this would affect, especially since almost everyone got pushed into 2018 for their Model 3.
> 
> If you don't think a HUGE number of people would cancel or postpone their purchase because of this, just look on Reddit, etc. People are already saying they would do just that. I would postpone mine if they kill the tax credit just because I would really like white interior. The only reason I was going to just settle for black was to get the full tax credit.


Remember the credit only applies to US reservation holders. At one point it was speculated or confirmed (forget which) that more than half the reservations are outside the US.


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## tivoboy (Mar 24, 2017)

McHoffa said:


> Nearly all reservations holders would fall into either full tax credit (Q1/Q2) or half tax credit (Q3/Q4). That's probably 300,000+ people that this would affect, especially since almost everyone got pushed into 2018 for their Model 3.
> 
> If you don't think a HUGE number of people would cancel or postpone their purchase because of this, just look on Reddit, etc. People are already saying they would do just that. I would postpone mine if they kill the tax credit just because I would really like white interior. The only reason I was going to just settle for black was to get the full tax credit.


I'm going to say that a SIGNIFICANT number of people would cancel if they don't get the 7,500$ tax credit. now, with the line in place for a model 3, it's not necessarily going to kill sales in the short run, but MANY people will cancel if this indeed gets killed.

personally, I don't really understand the why. Its just vindictive. The oil and gas industries continue to get BILLIONS in subsidies and tax breaks annually, why shouldn't these alternative industries get something similar.

IIC


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## Tesla2ElectricBoogaloo (Aug 1, 2017)

New possible scenario for me, when two bits of news in the last 24 hours are placed side-by-side:

Buy a CPO/Loaner/Inventory Model S in order to get the tax credit before the GOP kills it.

Defer my spot in line to summertime and get a Model 3 P-Longrange-D (seriously, what are they going to call it if the numbers are gone from the naming convention? LOL)


Stay tuned.


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## danzgator (May 17, 2017)

Tesla2ElectricBoogaloo said:


> Buy a CPO/Loaner/Inventory Model S in order to get the tax credit before the GOP kills it.


FYI-no tax credit on CPO.


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## Tesla2ElectricBoogaloo (Aug 1, 2017)

danzgator said:


> FYI-no tax credit on CPO.


yea, my fault, mind moving faster than my fingers.

Loaner/floor model. As long as its never been titled, I'll qualify.

and I won't apply for my $2500 state rebate until I get the 3 (because you're required to hold the car for 3 years, or they can dock your state return to repay themselves)


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## vita10gy (Sep 12, 2017)

Even if buyers don't cancel it might effect what they spend on options that are generally high margin. (Tesla has 2 that are basically ALL margin with AP and FSD)

We're talking hundreds of millions that would have gone straight to Tesla, depending on this that and the other maybe as much as almost half a billion. This isn't good news for Tesla. It doesn't matter if this puts them on a level playing field in 3 years with companies with infinitely deep pockets that never used their credits if Tesla isn't a thing in 3 years.

I'm not "predicting" demise, but they sure as hell aren't out of the woods, and the bad news is piling up.


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## danzgator (May 17, 2017)

I think everyone is going nuts about this a little prematurely. This is just a proposed house bill and congress hasn't been able to pass much of anything all year. They have 5 work weeks left to get it passed by the house, then the senate, then signed by the president. Plus there's Thanksgiving and Christmas coming up. The EV credit thing aside, its doubtful 50% of the house and senate agree with everything in this bill. Although Trump wants it passed by Thanksgiving, everything I read before today by the experts said that it wasn't likely that they could get it passed in time. I'd say it's possible, if everything goes perfectly, but not probable.


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## JWardell (May 9, 2016)

As a homeowner and 2018 EV purchaser, I stand to lose TEN GRAND out of my pocket with Trump's tax "reductions"

I will not be able to swing a $55000 Model 3 if I have to pass an extra ten grand to the megarich.

So yes, @danzgator , I am going nuts.


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## Sandy (Jun 3, 2017)

In Ontario we would get $14,000 provincial incentive for a new Model 3 purchase plus up to $1000 towards home electrical upgrade. In a tax free cheque after purchase. We have an election late spring ‘18. Change of government might cancel the program.
I could order a Bolt today and get the $14,000. I don’t want a Bolt.
I’ll buy a Model 3 anyways. If the program is cancelled it will cost me more than I planned but it’s worth it to me. I will delay other home ‘projects’ to make it work. I want a Model 3.


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## Bokonon (Apr 13, 2017)

I think this is the first time I've ever found myself actively rooting for GM et al. and their army of Detroit lobbyists. These are strange times, indeed...



> Fears of a negative response from buyers could explain why GM and other carmakers are spending more lobbying time trying to make sure the tax credit is renewed and making the case that the industry has truly committed to electric cars, thanks to federal incentives and sales mandates in both California and China, say two people familiar with the matter.
> 
> GM spokesman Pat Morrissey says the credits "are still necessary to help grow the EV market," adding that *the company is working with the Trump administration and Congress*.


(source)


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## Bokonon (Apr 13, 2017)

Tesla2ElectricBoogaloo said:


> New possible scenario for me, when two bits of news in the last 24 hours are placed side-by-side:
> 
> Buy a CPO/Loaner/Inventory Model S in order to get the tax credit before the GOP kills it.
> 
> ...


Interesting plan. If you can get a sweet deal on a showroom model, it might work out decently, since the first-year depreciation hit won't be as bad. Otherwise, on a new S, you'll probably take a hit in excess of the $7500 that you're saving via the tax credit, but I can see a few benefits for you that may make that hit worth your while:

*It buys you time to wait for the Model 3 that you truly want.* You've pretty much been a check-all-the-boxes/PDL guy from the beginning, but at this point, I wouldn't expect the PDL version (which I imagine they'll simply called "Performance") to start delivery until at least a year from now (if not early 2019), unless the "Performance" and "Dual Motors" configurations somehow end up being one-in-the-same. You'll also have the ability to wait until any initial production issues for the Performance configuration are worked out. No compromises necessary.

*You get to drive a Model S in the meantime.* No explanation required here, though you will run the risk of actually wanting to keep it.

*The person who agreed to buy your Audi would be pretty pissed off if you reneged on your deal.* And they probably know where you live, and where they'd be able to find a brand-new Model 3 in a few months...


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## chojn1 (Oct 2, 2017)

Tesla is at about 150k cars produced, so they will have about 2 quarters more of the full incentives at most. Once the incentives run out for Tesla, then all the competition will have a $7500 price advantage over Tesla for a few years if the tax code remains as is. 

The best scenario is if Tesla can deliver their 200k cars before the new rule takes effect. Common Musk, hurry up! Get those 3's out the door.


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## DrSheldor (Sep 22, 2017)

chojn1 said:


> Tesla is at about 150k cars produced, so they will have about 2 quarters more of the full incentives at most. Once the incentives run out for Tesla, then all the competition will have a $7500 price advantage over Tesla for a few years if the tax code remains as is.
> 
> The best scenario is if Tesla can deliver their 200k cars before the new rule takes effect. Common Musk, hurry up! Get those 3's out the door.


Remember that credit is not just on the first 200K, but the rest of the cars sold during that quarter PLUS the next quarter, which if they were making 5k Model 3's per week could be MANY people missing out on the full $7500.


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## chojn1 (Oct 2, 2017)

DrSheldor said:


> Remember that credit is not just on the first 200K, but the rest of the cars sold during that quarter PLUS the next quarter, which if they were making 5k Model 3's per week could be MANY people missing out on the full $7500.


At 25k model s and x sold per quarter currently, Tesla will reach 200k in two quarters even if they produce no more model 3. I think June 30th is the end of the $7500 for Tesla. There is a phase out after that. Again, after that the competition have a price advantage.

How many people missing out depends on if and when this new rule takes effect, and how Tesla chose to time their deliveries (i.e holding the 200k th car until the start of the next quarter).


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## mtdoak (Aug 1, 2017)

I honestly have zero idea what I’m doing if the tax credit isn’t there. Maybe wait for awd. Maybe look at a used s/x.  My big reason for preordering was to guarantee the full tax credit. Take that away there’s no urgency in getting a tesla.


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## DinosM (Aug 10, 2017)

Call you congressman and tell them if they want your vote to vote against this stupid bill.


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## KY Chew (Oct 24, 2017)

I just bought a Model S (pick it up Monday). If this passes will I get screwed too?


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## SoFlaModel3 (Apr 15, 2017)

KY Chew said:


> I just bought a Model S (pick it up Monday). If this passes will I get screwed too?


No, it looks like the proposed end is 12/31/17, so you're good so long as you take delivery by the last day of the year.


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## Justmurr (Aug 13, 2017)

Well...it has to pass before it matters but as someone who just cannot afford a new S...if the $7500 gets taken out of the picture I view that as making CPOs more worthy of consideration.

I am just truly tired of waiting to become a Tesla owner.


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## SoFlaModel3 (Apr 15, 2017)

Justmurr said:


> Well...it has to pass before it matters but as someone who just cannot afford a new S...if the $7500 gets taken out of the picture I view that as making CPOs more worthy of consideration.
> 
> I am just truly tired of waiting to become a Tesla owner.


The thing for me is that I really do prefer the size (and range) of the 3 over the S. Don't get me wrong, I love the S it's just not my preference of the 2 which makes it hard for me to attempt to push to spend more for it.


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## Justmurr (Aug 13, 2017)

SoFlaModel3 said:


> The thing for me is that I really do prefer the size (and range) of the 3 over the S. Don't get me wrong, I love the S it's just not my preference of the 2 which makes it hard for me to attempt to push to spend more for it.


Yeah, I want the 3 too.
I just know that losing that $7500 will sting (if it happens) and I'm an impulse guy...I just fear my actions come January as I browse through the CPOs and very likely decide to ride out the model 3 "ramp up" from the slightly worn seat of my Tesla Model S.


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## MelindaV (Apr 2, 2016)

JWardell said:


> As a homeowner and 2018 EV purchaser, I stand to lose TEN GRAND out of my pocket with Trump's tax "reductions"
> 
> I will not be able to swing a $55000 Model 3 if I have to pass an extra ten grand to the megarich.
> 
> So yes, @danzgator , I am going nuts.


plus add to that, eliminating the ability to deduct your state income tax from your federal taxes. for those that work in states with income tax, this is another huge tax increase!


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## PatrickM (Oct 3, 2017)

I ran the numbers using this website:
https://www.calcxml.com/calculators/trump-tax-reform-calculator
and I was underwhelmed. Not counting the fact that I was expecting a $7500 EV credit next year, using my numbers from my 2016 taxes my effective tax rate and the amount that I calculated as owed didn't budge much. It's a small reduction but it's basically a wash. But since this is supposed to be the "biggest tax cut in history", I was expecting to actually see my taxes actually get cut by a substantial percentage. For people with large estates - who no longer will pay estate tax at all - and to corporations who see their tax rate go down by 33% (from 30% to 20%) and to anyone with an S-Corp and pass-through income who see a 38% reduction (from 40% tax rate to 25%) this is a pretty great deal. For normal people, it seems like not much of anything... and meanwhile it will add over $1.5 trillion over 10 years to the debt so we all end up paying for it one way or another in the end.


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## MelindaV (Apr 2, 2016)

PatrickM said:


> I ran the numbers using this website:
> https://www.calcxml.com/calculators/trump-tax-reform-calculator
> and I was underwhelmed. Not counting the fact that I was expecting a $7500 EV credit next year, using my numbers from my 2016 taxes my effective tax rate and the amount that I calculated as owed didn't budge much. It's basically a wash. But since this is supposed to be the "biggest tax cut in history", I was expecting to actually see my taxes actually get cut by a substantial percentage. For people with large estates - who no longer will pay estate tax at all - and to corporations who see their tax rate go down by 30% and to anyone with an S-Corp and pass-through income who see a 38% reduction (from 40% tax rate to 25%) this is a pretty great deal. For normal people, it seems like not much of anything... and meanwhile it will add over $1.5 trillion over 10 years to the debt so we all end up paying for it one way or another in the end.


the analogy I'd seen posted a while ago was an average of $x per citizen in tax savings.... same as saying if you have 500 people and give one person $500, on average, everyone in the group has $1. In reality one person has $500 and 499 people have nothing.


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## scaots (Sep 13, 2017)

Definitely will be significant for me. I still will likely get a Tesla, but I don't actually need a new car soon so would definitely be waiting some additional period without full tax credit, maybe for AWD. Sure I would be sad when traveling without autopilot and filling gas every week, but I would probably wait for an AWD Model Y which I think would be more ideal for me anyway. Though was hoping to pick up the 3 and in about 5 years add the Y.


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## PTC Gator (Sep 3, 2017)

I don't think that tax calculator takes into account the loss of state income tax deduction.


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## mservice (Jul 29, 2017)

SoFlaModel3 said:


> No, it looks like the proposed end is 12/31/17, so you're good so long as you take delivery by the last day of the year.


Maybe not.. my tax preparer said at first review it appeared that it could impact all cars purchased this year. The repeal stated that it is an "immediate repeal" of the incentive. Now he said he needs to look into further considering that the plan just came out. However, I wouldn't hold my breath that the republicans will get the plan passed, there are already republicans saying they can't support it. Can you say health care? Maybe Trump will get a lump of coal in his Xmas stocking, and i'll get my 7500.00


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## PatrickM (Oct 3, 2017)

PTC Gator said:


> I don't think that tax calculator takes into account the loss of state income tax deduction.


I took it into account. I ended up having to take the new standard deduction because several of my previous deductions won't be allowed under the bill. I used to itemize, but since several of my deductions are now eliminated I don't need to - although it's close. So my deductions fell - by a little - putting me under the new standard deduction, so I just used that.

Also, since this is a Telsa Model 3 board, I'll go back on topic and I'd just like to say that I don't think my plans have changed. I'll still order my Model 3 the minute it is available to me whether I get the credit or not. If my plans have changed, it's because I'm contemplating a Model S 75D instead... but I still want the Model 3 instead for a variety of reasons.

But between the schedule slip announcement yesterday and this unsurprising but still disappointing tax credit news today, I'm a bit bummed out. And motivated to write letters to my representatives who will undoubtedly ignore me but I'll do it anyway.


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## Dan Detweiler (Apr 8, 2016)

My prediction...just my opinion...not really based on anything but my gut reaction.

The tax bill will pass, in some form or fashion before the end of the year. Whatever form it takes, the EV tax credit will go away. The right sees it as a unfair blow to the established auto industry (with big pockets in the Republican favor). Tens of thousands of reservations will be cancelled in the short term. Tesla will hit it's stride with production by mid next year. Hundreds of thousands will be sold within a year of that. The media will see it as a Tesla fail. They will report that the Model 3 ins't the "car for the masses" as Tesla had said seeing as though the middle income folks that needed the tax credit to afford the vehicle will be forced to look elsewhere. Over the next several years MILLIONS more will be sold when the general public begins to see it as a superior vehicle...not just EV but any vehicle. Media will continue to see it as a fail because Tesla wasn't able to meet their initial predictions. Tesla stock soars anyway. EV revolution wins in the long run.

Short term fail...long term win.

Just my $.02

Dan


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## Daniel D. (Mar 21, 2017)

If the tax credit expires this year and Tesla does not offer leases on the Model 3 for some time to come it makes more sense to lease a Model S as quickly as possible. The monthly car payment on a financed first production Model 3 is eerily similar to a leased Model S 75D.


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## SoFlaModel3 (Apr 15, 2017)

mservice said:


> Maybe not.. my tax preparer said at first review it appeared that it could impact all cars purchased this year. The repeal stated that it is an "immediate repeal" of the incentive. Now he said he needs to look into further considering that the plan just came out. However, I wouldn't hold my breath that the republicans will get the plan passed, there are already republicans saying they can't support it. Can you say health care? Maybe Trump will get a lump of coal in his Xmas stocking, and i'll get my 7500.00


There is a snippet of the bill shown in the Electrek article that seems to make it very clear this goes into effect 1/1/2018 if passed as written.


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## SoFlaModel3 (Apr 15, 2017)

Daniel D. said:


> If the tax credit expires this year and Tesla does not offer leases on the Model 3 for some time to come it makes more sense to lease a Model S as quickly as possible. The monthly car payment on a financed first production Model 3 is eerily similar to a leased Model S 75D.


This depends on your situation of course. I drive 18,000 miles a year and figure that ratchets up with the Tesla as it will become our exclusive weekend and road trip car.

Right now the biggest mileage allowance on a Model S lease is 15,000 miles.

If you go base everything but pick a color of paint, the lease is $1,005. Mind you they also don't offer sign and drive so you have to make your first payment and deposit up front hitting for you ~$7,000. Now the credit factored into the lease does bring down the monthly payment substantially. I'm not sure how they apply it to a lease but $7,500 / 36 = $208.33. That brings the monthly nut under $800.

On my Model 3 the monthly payment will be ~$870, but I have no mileage constraints and of course equity at the end.

This may work for some, but not necessarily for everyone. It is intriguing though...


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## Daniel D. (Mar 21, 2017)

SoFlaModel3 said:


> This depends on your situation of course. I drive 18,000 miles a year and figure that ratchets up with the Tesla as it will become our exclusive weekend and road trip car.
> 
> Right now the biggest mileage allowance on a Model S lease is 15,000 miles.
> 
> ...


Honestly, neither situation is ideal for me. I have never financed a car before because I have always enjoyed driving something new every couple of years with a lower monthly payment. While my budget could pay for a financed Model 3, it was not what I was counting on doing at all. It is a decision I will have to make when the configurator opens.


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## SoFlaModel3 (Apr 15, 2017)

Daniel D. said:


> Honestly, neither situation is ideal for me. I have never financed a car before because I have always enjoyed driving something new every couple of years with a lower monthly payment. While my budget could pay for a financed Model 3, it was not what I was counting on doing at all. It is a decision I will have to make when the configurator opens.


I'm with you. I always leased until my wife had us move out to "the burbs" ... my daily commute went from 5 minutes to 45 minutes.


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## mservice (Jul 29, 2017)

SoFlaModel3 said:


> There is a snippet of the bill shown in the Electrek article that seems to make it very clear this goes into effect 1/1/2018 if passed as written.
> 
> View attachment 3952


OK that looks good for anyone who is lucky enough to get their car by 12.31.17. So, you got two months to get your 7500.00, be it the M3, or a jump to an MS. Considering the numbers of threes being produced there aren't going to be many getting the incentive.


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## SoFlaModel3 (Apr 15, 2017)

mservice said:


> OK that looks good for anyone who is lucky enough to get their car by 12.31.17. So, you got two months to get your 7500.00, be it the M3, or a jump to an MS. Considering the numbers of threes being produced there aren't going to be many getting the incentive.


Remember that's assuming this happens. I did see some Tweets (take that at face value) mentioning that this is close to being squashed which would leave the credit intact.


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## MelindaV (Apr 2, 2016)

mservice said:


> OK that looks good for anyone who is lucky enough to get their car by 12.31.17. So, you got two months to get your 7500.00, be it the M3, or a jump to an MS. Considering the numbers of threes being produced there aren't going to be many getting the incentive.


Before everyone panics, remember, the PROPOSED bill was just released. It is far from a done deal. So call you reps/senators and let them know this is important to you.


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## mservice (Jul 29, 2017)

Dan Detweiler said:


> My prediction...just my opinion...not really based on anything but my gut reaction.
> 
> The tax bill will pass, in some form or fashion before the end of the year. Whatever form it takes, the EV tax credit will go away. The right sees it as a unfair blow to the established auto industry (with big pockets in the Republican favor). Tens of thousands of reservations will be cancelled in the short term. Tesla will hit it's stride with production by mid next year. Hundreds of thousands will be sold within a year of that. The media will see it as a Tesla fail. They will report that the Model 3 ins't the "car for the masses" as Tesla had said seeing as though the middle income folks that needed the tax credit to afford the vehicle will be forced to look elsewhere. Over the next several years MILLIONS more will be sold when the general public begins to see it as a superior vehicle...not just EV but any vehicle. Media will continue to see it as a fail because Tesla wasn't able to meet their initial predictions. Tesla stock soars anyway. EV revolution wins in the long run.
> 
> ...


Dan: Nice premise, but I'm not sure that Trump will get his tax plan in two months. There are more republicans from larger states that are publicly stepping away from the current iteration of the plan. This will mean they will have to compromise to pass anything close to what they propose. While the current proposed plan cuts a number of deduction americans love, specicaly the state tax deductions, I doubt that it will make it by the end of the year, because they will not have the republican votes to push it through. This will keep the tax incentive to next year. I do agree that we will have some type of plan but doubtful by the end of the year. That all being said I could be wrong


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## Dr. J (Sep 1, 2017)

I can remember Republicans decrying "uncertainty" as the biggest bugaboo of any proposal to change tax policy. And they've just introduced a boatload of uncertainty in several longstanding areas of tax policy--not just EV credits, but housing tax credits (by lowering the corporate tax rate) and rehabilitation tax credits (by repealing them) as well. Not to mention reducing the value of the mortgage interest deduction, the charitable contribution deduction, etc., etc., by nearly doubling the standard deduction while eliminating personal exemptions.


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## mservice (Jul 29, 2017)

While I would love to get the 7500.00 incentive, or any form of it, it doesn’t mean if it is gone I won’t be buying the M3. If you can’t buy without the 7500.00 you might need to reasses your decision to buy an M3. Maybe you should wait and get the floor model at 35000.00 rather than the extended battery, premium package, wheels, and custom paint options.


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## garsh (Apr 4, 2016)

Dr. J said:


> I can remember Republicans decrying "uncertainty"...


Hey guys, I know this is going to be difficult, but please try to keep the political discourse to a minimum here. It's been mostly pretty civil, so thank you for that. But I'd like us to stay away from generalizations like this. Not everybody who registered as one of the parties necessarily agrees with everything on a party platform, and I don't want people to feel like they can't be part of our community.

Suggesting that people call their representatives? Good!
Talking about exactly which representatives introduced a bill? Facts are fine. Just stay away from name-calling.
Otherwise, try to keep political discourse to a minimum here. There are other forums that are better for those discussions.


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## mservice (Jul 29, 2017)

SoFlaModel3 said:


> Remember that's assuming this happens. I did see some Tweets (take that at face value) mentioning that this is close to being squashed which would leave the credit intact.


Yep, that's what i've been saying it's doubtful that Trump has the votes to pass the current plan. And in my opinion they won't have a plan by the end of the year.


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## MelindaV (Apr 2, 2016)

mservice said:


> While I would love to get the 7500.00 incentive, or any form of it, it doesn't mean if it is gone I won't be buying the M3. If you can't buy without the 7500.00 you might need to reasses your decision to buy an M3. Maybe you should wait and get the floor model at 35000.00 rather than the extended battery, premium package, wheels, and custom paint options.


totally agree. I would love to have the credit applied to my tax return, but have planned all along to get the car with or without it. Assuming I do get the credit, I'd either drop the tax return $ into my mortgage or put it toward some house project - maybe put it toward the outstanding car loan, but more likely toward the house.


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## Dr. J (Sep 1, 2017)

garsh said:


> Hey guys, I know this is going to be difficult, but please try to keep the political discourse to a minimum here. It's been mostly pretty civil, so thank you for that. But I'd like us to stay away from generalizations like this. Not everybody who registered as one of the parties necessarily agrees with everything on a party platform, and I don't want people to feel like they can't be part of our community.
> 
> Suggesting that people call their representatives? Good!
> Talking about exactly which representatives introduced a bill? Facts are fine. Just stay away from name-calling.
> Otherwise, try to keep political discourse to a minimum here. There are other forums that are better for those discussions.


Understood. I was wondering how far I could push it.


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## BobLoblaw (Apr 4, 2017)

I'm sad yet completely unsurprised to hear about this. I'll leave the political portion at that.

I really have to wonder what the fallout of this is going to be, specifically regarding the 3. Visiting forums, talking to people, etc...I have the real sense that many were going to be stretching themselves quite thin to purchase this car. Here in BC, we get a $5000 discount on EVs - even with that it's a spendy car, especially when compared to ICE cars in it's segment (BMW/Audi). I wonder if the "electric car for the masses" just got outed for what it really is - an entry level luxury car with the resulting "future" sales figures to back the claim. It's going to result in only those with a significant disposable income or appetite for debt to get into it. That's unfortunate.

My prediction for US sales figures if this goes through....the car will still be very appealing to those considering a Model S, a Bolt, or other long-range BEV. People who were excited to get into an EV but were making a step up already (I suspect a large portion of reservations) will either bail on their reservation or wait it out a while. I'm confident we can take the overall US sales figures and cut them in half. None of this is good for overall EV sales, the planet, or individual purchasers. 

Condolences from Canada, I realize this probably changes and/or makes some of your Model 3 dreams harder to attain. That's a kick square in the you-know-where after following this project for so long.


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## mtdoak (Aug 1, 2017)

SoFlaModel3 said:


> Remember that's assuming this happens. I did see some Tweets (take that at face value) mentioning that this is close to being squashed which would leave the credit intact.


The tax plan as is won't pass. It's going to get marked up alot. The question will be, will the EV rebate make it? Will they be able to pass any tax reform at all?


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## tonymil (Aug 2, 2017)

mservice said:


> While I would love to get the 7500.00 incentive, or any form of it, it doesn't mean if it is gone I won't be buying the M3. If you can't buy without the 7500.00 you might need to reasses your decision to buy an M3. Maybe you should wait and get the floor model at 35000.00 rather than the extended battery, premium package, wheels, and custom paint options.


Well, I couldn't disagree more. What makes you think that folks here who are willing to stretch their budget to help the environment haven't already decided to go for the cheapest version they can get - which would include factoring in whether or not the tax credit will be there when they sign the dotted line? I don't think they need to be preached to by those with more disposable income.


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## garsh (Apr 4, 2016)

tonymil said:


> I don't think they need to be preached to by those with more disposable income.


I don't think he was preaching at all. Just talking through a thought process, trying to understand how this could affect a sub-group of potential Model 3 buyers.


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## tonymil (Aug 2, 2017)

garsh said:


> I don't think he was preaching at all. Just talking through a thought process, trying to understand how this could affect a sub-group of potential Model 3 buyers.


It sounded snarky to me. He's directing his comment to people dependent on the tax credit to be able to afford the model 3 and telling them to give up on all the extra goodies that inflate the price of the 3, as if people in that category need to be told that. Maybe, just maybe, we know how to do maths.


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## Insaneoctane (May 10, 2017)

I just posted this on the *other* forum, but it's still something I think everyone should consider....

To be clear, this bill is absolutely good news for Tesla. They have a back order of about 500K M3's. Even if 25% of their buyers drop, they still have 375K buyers which translates to well over a year of back orders. The people who bail just drop out and those behind them drop in. At that point, once their CURRENTLY existing orders have been filled, they have been making continuous improvements to the production line and can afford to reduce the cost of the vehicle without affecting gross margins! So, now some of the people who dropped come back and Tesla appeals to an even broader market. Hell, maybe Tesla even starts to advertise their cars? Meanwhile, all of the "competition" needs the federal tax credit to sell almost every single car that they make. How many Leafs and Fiats do you think sell at full boat? They will seriously be hurt by this. Meanwhile Tesla enjoys the full benefit of their superior infrastructure and technology and continues to provide EVs to the world. The biggest losers here are American's who will see the EV adoption rate slowed here (not stopped) by this short sighted decision. Tesla though? Buy more TSLA.


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## Johnm6875 (Nov 14, 2016)

Insaneoctane said:


> I just posted this on the *other* forum, but it's still something I think everyone should consider....
> 
> To be clear, this bill is absolutely good news for Tesla. They have a back order of about 500K M3's. Even if 25% of their buyers drop, they still have 375K buyers which translates to well over a year of back orders. The people who bail just drop out and those behind them drop in. At that point, once their CURRENTLY existing orders have been filled, they have been making continuous improvements to the production line and can afford to reduce the cost of the vehicle without affecting gross margins! So, now some of the people who dropped come back and Tesla appeals to an even broader market. Hell, maybe Tesla even starts to advertise their cars? Meanwhile, all of the "competition" needs the federal tax credit to sell almost every single car that they make. How many Leafs and Fiats do you think sell at full boat? They will seriously be hurt by this. Meanwhile Tesla enjoys the full benefit of their superior infrastructure and technology and continues to provide EVs to the world. The biggest losers here are American's who will see the EV adoption rate slowed here (not stopped) by this short sighted decision. Tesla though? Buy more TSLA.


The "Y" and pickup truck were never going to sell with the tax credit. Short term pain for many of us but overall better competitive position for Tesla.


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## McHoffa (Jan 26, 2017)

Daniel D. said:


> If the tax credit expires this year and Tesla does not offer leases on the Model 3 for some time to come it makes more sense to lease a Model S as quickly as possible. The monthly car payment on a financed first production Model 3 is eerily similar to a leased Model S 75D.


Sure, if you want a 75D with no options, but that's still a better car in most ways (much lower range though)


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## McHoffa (Jan 26, 2017)

mservice said:


> If you can't buy without the 7500.00 you might need to reasses your decision to buy an M3. Maybe you should wait and get the floor model at 35000.00 rather than the extended battery, premium package, wheels, and custom paint options.


I can buy it without it, but not getting it will affect when I buy it, and possibly which options I choose. When, because if I don't get it, I might hold off a couple months, and options, because if I get some money back, I'm willing to spend a little more than I would have normally.


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## Petra (Sep 12, 2017)

McHoffa said:


> Sure, if you want a 75D with no options, but that's still a better car in most ways (much lower range though)


Not sure I'd agree with that outright...


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## Daniel D. (Mar 21, 2017)

McHoffa said:


> Sure, if you want a 75D with no options, but that's still a better car in most ways (much lower range though)


It would have enhanced autopilot and a color other than black and be about the same price as a fully loaded model 3 (paint + 19" rims + EAP) depending on your interest rate of course


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## Dr. J (Sep 1, 2017)

mtdoak said:


> The tax plan as is won't pass. It's going to get marked up alot. The question will be, will the EV rebate make it? Will they be able to pass any tax reform at all?


It might pass the House as-is, and even if modified, the little-bitty EV credit isn't anywhere near important enough to get consideration IMHO. Now, the Senate is a different story. I have no idea what to expect from that august body.
My prediction: the House will pass something; the Senate will pass something different; the House will approve whatever the Senate passes. Per the plan for Obamacare repeal.


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## mservice (Jul 29, 2017)

tonymil said:


> It sounded snarky to me. He's directing his comment to people dependent on the tax credit to be able to afford the model 3 and telling them to give up on all the extra goodies that inflate the price of the 3, as if people in that category need to be told that. Maybe, just maybe, we know how to do maths.


@tonymil: Well your misunderstanding what I wrote, there are a number of people who were interested in early adoption and were looking at the 7500.00 incentive to buy one. If, and I don't think the tax plan will pass by the end of the year, the 7500.00 dies they still have options on getting a 3, they don't need to just jump out, there are options. And by they way I'm retired on a fixed income and have looked at my options and am lucky I can still buy the first roll out without the 7500.00. I know some may not but that doesn't say they don't have options. Hopefully this cleared it up.


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## Silver (Sep 21, 2017)

I'm pretty sure that even if the plan isn't passed by the end of the year, (say March for example) it can still be retroactively applied to cars produced from the beginning of the year. This just adds more complexity to the decision. 

I've been waiting for this car for 2 years now, line waiter. I was planning on the base model 3 for my son and if the credit falls through I would cancel and get him a used ICE.


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## Insaneoctane (May 10, 2017)

mtdoak said:


> The tax plan as is won't pass. It's going to get marked up alot. The question will be, will the EV rebate make it? Will they be able to pass any tax reform at all?


Don't confuse this reality check as an opinion of what I want.... But, while us fellow EV evangelists are destroyed by this news, we are significantly the *minority*. Last year, in the US, EV sales were <1% of overall vehicle sales. For the first half of 2017 they are still only 1%. So, while the EV community can get mad (we are) and vocalize ourselves, call our representatives, etc. the sales numbers don't indicate that most of America gives a rip. So, with all the powerful lobbyist that are being told to go "suck it" today and the days to come, because their prized loophole or subsidy is being eliminated, sadly, I fear the little EV lobbyist doesn't stand a chance here.


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## Enginerd (Aug 28, 2017)

1. I'd certainly be bummed if this tax credit got nixed.
2. However, I find it odd that it factors so heavily in buyers' short term plans, because the timing of the credit is a pretty long term thing. For example, if I got my Model 3 in January 2018 (I wish), the credit would show up on my 2018 tax return, which probably wouldn't be filed until April 2019. Then the refund check would be in May 2019. That means your finances would have to be prepared to wait 14 months for the federal tax credit bailout. It doesn't come the day you purchase your car.


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## PTC Gator (Sep 3, 2017)

Enginerd said:


> 1. I'd certainly be bummed if this tax credit got nixed.
> 2. However, I find it odd that it factors so heavily in buyers' short term plans, because the timing of the credit is a pretty long term thing. For example, if I got my Model 3 in January 2018 (I wish), the credit would show up on my 2018 tax return, which probably wouldn't be filed until April 2019. Then the refund check would be in May 2019. That means your finances would have to be prepared to wait 14 months for the federal tax credit bailout. It doesn't come the day you purchase your car.


If the money was needed, you could file in Jan '19 and have an electronic refund by Valentines. May of 19 is a pretty extreme example.

[corrected year to 19]


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## Jimmy Pepe Russels (Jun 23, 2017)

MelindaV said:


> Before everyone panics, remember, the PROPOSED bill was just released. It is far from a done deal. So call you reps/senators and let them know this is important to you.


Quoted for truth.

----

LOL... Damn...

so the House Ways & Means Committee shoved some hardcore bulletpoints into some pages to budget what we are going to do with the greatest GDP in the world for 2018. The Senate Finance Committee will then review it, and then it will go through a sort of 'circular feedback loop' and changed.

Think of it this way: Imagine you are haggling in a free market in a small country (from either side). Are you gonna go and lay out your closest price for an arms-length'd transaction at the very beginning?

No.

You're gonna Art of the Deal it. One side says "this is worth $1,000", and another side says "best I can do is $5". Eventually compromise should settle in at a fair market value. If the government doesn't mind losing millions by literally shutting down due to GDP discretionary budgets, (and literally works what, 20 hrs a week?), there should be some nicely-planned and well-deserved friction.

These oil bastards better not tread on me though, all I'm gonna say. If they can war for other countries' and oil co's profit, they can get off my lawn and wallet na'msayin


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## Dr. J (Sep 1, 2017)

As the EV credit repeal is such a tiny part of this bill, I would guess the best case for the tax credit to survive is the whole darn thing (the House tax bill) goes off the rails. And that would be OK with me. (End of political commentary, before I get chastised.) Have a nice day!


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## Enginerd (Aug 28, 2017)

PTC Gator said:


> If the money was needed, you could file in Jan '18 and have an electronic refund by Valentines. May of 18 is a pretty extreme example.


You wouldn't be able to file your 2018 taxes until 2019. My point is that it's a delayed gift that comes well after you take delivery of the car, not a price reduction at the time of purchase.


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## MelindaV (Apr 2, 2016)

Daniel D. said:


> It would have enhanced autopilot and a color other than black and be about the same price as a fully loaded model 3 (paint + 19" rims + EAP) depending on your interest rate of course


least expensive Model S with EAP+PUP+color (which would the the closest configuration to the Model 3 LR+EAP+PUP+color+wheels at $56,500) comes to $86,000 - that's $29,500 more. even if you reduce that by the $7500, it is still more than $20k over the Model 3. That to me is not 'about the same price'.


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## @gravityrydr (Apr 12, 2016)

SoFlaModel3 said:


> Now the credit factored into the lease does bring down the monthly payment substantially. I'm not sure how they apply it to a lease but $7,500 / 36 = $208.33. That brings the monthly nut under $800.
> 
> On my Model 3 the monthly payment will be ~$870, but I have no mileage constraints and of course equity at the end.
> 
> This may work for some, but not necessarily for everyone. It is intriguing though...


I thought the credit does not apply to you if you are leasing?


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## MelindaV (Apr 2, 2016)

@gravityrydr said:


> I thought the credit does not apply to you if you are leasing?


the tax credit goes to the leasing company, which in theory then reduces the cost to the customer over the life of the lease.


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## @gravityrydr (Apr 12, 2016)

Enginerd said:


> For example, if I got my Model 3 in January 2018 (I wish), the credit would show up on my 2018 tax return, which probably wouldn't be filed until April 2019. Then the refund check would be in May 2019. That means your finances would have to be prepared to wait 14 months for the federal tax credit bailout. It doesn't come the day you purchase your car.


While I'm not dependent on the tax credit, it is making the jump to first production easier. Also it would have been nice to get it for a purchase right at the end of the year.


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## SoFlaModel3 (Apr 15, 2017)

@gravityrydr said:


> I thought the credit does not apply to you if you are leasing?


The leasing company earns the credit and passes it along. Now I certainly do not know the finer details, but that's my understanding.


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## Jimmy Pepe Russels (Jun 23, 2017)

^Operating vs capital lease


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## tonymil (Aug 2, 2017)

mservice said:


> @tonymil: Well your misunderstanding what I wrote, there are a number of people who were interested in early adoption and were looking at the 7500.00 incentive to buy one. If, and I don't think the tax plan will pass by the end of the year, the 7500.00 dies they still have options on getting a 3, they don't need to just jump out, there are options. And by they way I'm retired on a fixed income and have looked at my options and am lucky I can still buy the first roll out without the 7500.00. I know some may not but that doesn't say they don't have options. Hopefully this cleared it up.


OK, so no snark was intended, glad to hear that. But what makes you think that someone who is depending on the $7500 tax credit to afford the model 3 would also be looking to get the extra goodies that make the car more expensive? That would be self-defeating. Most likely folks like me were willing to part with the $1,000 deposit and see if whether the credit or a substantial portion of it would still be available when the golden ticket finally showed up. In fact, we put that deposit down without knowing how Tesla was going to price the car, other than his promise that it would be around $35,000, which would translate to 27,500 for those of us dependent on the federal credit. It wasn't until more than a year later that we learned that only a $49,000 version would initially be available, so that could not have been part of our calculation. Your comment seems to ignore the timeline that got us here.


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## garsh (Apr 4, 2016)

tonymil said:


> It wasn't until more than a year later that we learned that only a $49,000 version would initially be available, so that could not have been part of our calculation. Your comment seems to ignore the timeline that got us here.


Long before we learned that the $49k RWD version would be first, Musk had stated that the Model 3 launch would follow the same pattern as the X and S launches. That is, highly-optioned models would be sold first, to help Tesla become profitable before moving on to the lower-margin builds of the car.


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## Rusty (Sep 9, 2017)

MelindaV said:


> least expensive Model S with EAP+PUP+color (which would the the closest configuration to the Model 3 LR+EAP+PUP+color+wheels at $56,500) comes to $86,000 - that's $29,500 more. even if you reduce that by the $7500, it is still more than $20k over the Model 3. That to me is not 'about the same price'.


And it is not the same car. It is larger and the range difference is substantial.


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## AEDennis (Apr 10, 2016)

Rusty said:


> If you have the money, go for it. Just beware depreciation. I have been following the MS maket for several years. You will probably lose $10-15K to depreciation on a $75K MS over one year. Your best financial decision is to delay your sale or purchase a cheaper car to hold you over until the M3 is available. Just my 2 cents.


That would be an improvement.

It was about 9 months after we took delivery of our S when the D (and AP1.0) announcement came out. The S already took a $30k hit from what we paid for it (per Tesla trade in). I have a blog post somewhere (probably around D announcement.) I'll link to that later.


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## mtdoak (Aug 1, 2017)

I'm VERY curious when current owners (who, IIRC, still have a Nov-Jan estimate) will get their invites. It has to be soon, right? I'm on a Dec-Feb delivery estimate. My nightmare scenario right now is getting an invite in early Dec, with the tax credit still up in the air, and having to decide on whether to risk going for the 1st available and still not getting the tax credit.


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## SoFlaModel3 (Apr 15, 2017)

mtdoak said:


> I'm VERY curious when current owners (who, IIRC, still have a Nov-Jan estimate) will get their invites. It has to be soon, right? I'm on a Dec-Feb delivery estimate. My nightmare scenario right now is getting an invite in early Dec, with the tax credit still up in the air, and having to decide on whether to risk going for the 1st available and still not getting the tax credit.


You have to remember it's a range - if all current owners have a November - January range and they deliver nothing in November and December and all existing owners in January then they hit the range. Of course if that was the case then there is no way they'd make the December - February range cars in February.

My thinking is that since all of the cars are identical outside of paint color and rims that they can move quick once production is there. They can even produce the cars before the orders are in and then deliver quickly (1-2 weeks). To deliver to a current owner near the factory would not take a lot of lead time at all.

As for us non owners with the December - February range after the one month push back, I suggest planning for the worst.

To me the worst case is the car going at the end of the range (or later) and the credit being dropped.

If the credit being dropped is an issue for you then it's beat to wait if you're asked to configure before we're sure about the credit.

Always plan for the worst and be happy about the best case or something in between.


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## mtdoak (Aug 1, 2017)

tonymil said:


> OK, so no snark was intended, glad to hear that. But what makes you think that someone who is depending on the $7500 tax credit to afford the model 3 would also be looking to get the extra goodies that make the car more expensive? That would be self-defeating. Most likely folks like me were willing to part with the $1,000 deposit and see if whether the credit or a substantial portion of it would still be available when the golden ticket finally showed up. In fact, we put that deposit down without knowing how Tesla was going to price the car, other than his promise that it would be around $35,000, which would translate to 27,500 for those of us dependent on the federal credit. It wasn't until more than a year later that we learned that only a $49,000 version would initially be available, so that could not have been part of our calculation. Your comment seems to ignore the timeline that got us here.


I think for a lot of people who want to get the federal credit aren't "Depending" on it to get the car. Even at the bare bones, $27500 is a lot for a sedan. I think most people are considering the credit in how they option the vehicle, however.

Personally, I'd like to get the AWD Model 3. That being said, once I realized the timing, the AWD, in my mind, became a "cost AWD + $3750 loss of federal tax credit" option which made it a bit too pricy.

Being a non owner living on the east coast, my plan was to opt for the first available because

A) It would have guaranteed me a full $7500 credit
B) I wanted it ASAP.

I likely would have opted for the premium package, shorter range as I felt the $9000 for battery upgrade to be a bit steep. However, when I considered that a standard battery might push me to $3750 credit, I considered the it a $6250 "net cost" upgrade, which is a bit more reasonable.

IF the tax credit is gone as of 12/31 AND I won't get my Model 3 by then, I'm likely going to wait for the AWD model or, depending on pricing, the Performance Model. Or I take a look at pre owned AWD AP1 Model S/X's. My current car is paid off and in good condition, I can sock away monthly payments now and get some more goodies when its time to option mine out.


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## mtdoak (Aug 1, 2017)

SoFlaModel3 said:


> You have to remember it's a range - if all current owners have a November - January range and they deliver nothing in November and December and all existing owners in January then they hit the range. Of course if that was the case then there is no way they'd make the December - February range cars in February.
> 
> My thinking is that since all of the cars are identical outside of paint color and rims that they can move quick once production is there. They can even produce the cars before the orders are in and then deliver quickly (1-2 weeks). To deliver to a current owner near the factory would not take a lot of lead time at all.
> 
> ...


Yup. I just hope whatever happens with the tax credit, it gets decided quick. I think this uncertainty is likely the final nail in the coffin of me hoping to get a Model 3 in 2018. The uncertainty of the tax credit will likely cause current owners with a reservation to opt for the 1st Long Range + Premium rather than wait for a standard battery or even AWD.


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## PatrickM (Oct 3, 2017)

garsh said:


> Long before we learned that the $49k RWD version would be first, Musk had stated that the Model 3 launch would follow the same pattern as the X and S launches. That is, highly-optioned models would be sold first, to help Tesla become profitable before moving on to the lower-margin builds of the car.


As I recall that was not the pattern with the Model S. The original Model S launched in 2012 with an option to buy the 40kWh version for under $60k more or less immediately after launch to my memory of it. I don't remember it that there was only a high-end version available before slowly dropping down in price. I remember it that there were two options available immediately. But it was a long time ago and I can't find any links to back this memory up.


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## garsh (Apr 4, 2016)

PatrickM said:


> The original Model S launched in 2012 with an option to buy the 40kWh version for under $60k more or less immediately after launch to my memory of it.


You could order that option, but they didn't start delivering those low-end cars until a good bit later.


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## danzgator (May 17, 2017)

garsh said:


> You could order that option, but they didn't start delivering those low-end cars until a good bit later.


And they never even made the lowest end 40 because of low demand. They just gave those buyers a software limited 60.


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## sreams (Sep 12, 2017)

mtdoak said:


> I likely would have opted for the premium package, shorter range as I felt the $9000 for battery upgrade to be a bit steep. However, when I considered that a standard battery might push me to $3750 credit, I considered the it a $6250 "net cost" upgrade, which is a bit more reasonable.


Actually... $5250. $5250 + $3750 = $9K


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## McHoffa (Jan 26, 2017)

SoFlaModel3 said:


> You have to remember it's a range - if all current owners have a November - January range and they deliver nothing in November and December and all existing owners in January then they hit the range. Of course if that was the case then there is no way they'd make the December - February range cars in February.
> 
> My thinking is that since all of the cars are identical outside of paint color and rims that they can move quick once production is there. They can even produce the cars before the orders are in and then deliver quickly (1-2 weeks). To deliver to a current owner near the factory would not take a lot of lead time at all.
> 
> ...


I am a December-February now and while I'm still hoping for a late December I'm being realistic. In my situation not getting it this year means I need to wait until about May. If I get it in December I'll get a little back in February when I file in late January. If I don't get it this year that means I'll owe a lot (self employed) which would cut into my down payment, so I'd have to give it a couple more months.

If they kill the tax credit completely I might just wait for AWD. I wasn't going to wait just because it would mean $5000 + $3750. $9k for AWD wouldn't be worth it to me but if it's only going to be a difference of $5k I might wait. Haven't decided. At this point my excitement is wearing off due to the delay plus tax credit disappointment. Still buying but more likely to wait longer.


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## Rob Washington (Jun 17, 2017)

If tax credit stays, I’ll get the $49k M3 to ensure full tax credit. Then I adjust my tax withholding on a monthly basis to equal the tax credit. 

If the tax credit goes away, I’ll wait to get the $35k model (plus options). 220 Miles is all I have today in my ICE car and it lasts me 5-7 days between fill ups. 

I’ve seen the M3 at the Fremont delivery center and it is just right for me. No way I’m canceling.


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## Grashelm (Aug 4, 2017)

If the tax credit goes away, so will I. I can afford to pay cash for the car, but the value I am willing to assign to the vehicle was based upon applying the tax credit (with the options I wanted). If the tax credit is not available, then in my opinion, the car is overpriced. In no way is this a dig against the car/company. Merely my own opinion of value. I sincerely hope the efforts to remove the tax credit fail.


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## tivoboy (Mar 24, 2017)

danzgator said:


> FYI-no tax credit on CPO.


Indeed, each VIN will get any federal or state tax credits only once.


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## slasher016 (Sep 12, 2017)

I guess I'm in the minority of the board, but I consider the credit a nice to have. I'm buying a Model 3 (if I don't break down and buy a model S -- which I really shouldn't at my income level) regardless and consider the credit as a cherry on top.


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## Dogwhistle (Jul 2, 2017)

One of the big reasons used EV prices are so low, is that the Tax Credit is factored in to their original sale price and depreciation. I think we’ll see improvement in resale values once purchases prices aren’t reduced so much. So while losing the upfront price reduction is disappointing, you may find that you can make a good part of it up with better resale values a few years later.


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## M3OC Rules (Nov 18, 2016)

Dogwhistle said:


> One of the big reasons used EV prices are so low, is that the Tax Credit is factored in to their original sale price and depreciation. I think we'll see improvement in resale values once purchases prices aren't reduced so much. So while losing the upfront price reduction is disappointing, you may find that you can make a good part of it up with better resale values a few years later.


Ya. That's why it will be perfect if you get the Tax Credit and then it goes away.


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## Dogwhistle (Jul 2, 2017)

DC Rules said:


> Ya. That's why it will be perfect if you get the Tax Credit and then it goes away.


Yeah, I had been hoping for that best-case scenario too, but oh well!


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## Tesla Newbie (Aug 2, 2017)

Dogwhistle said:


> One of the big reasons used EV prices are so low, is that the Tax Credit is factored in to their original sale price and depreciation. I think we'll see improvement in resale values once purchases prices aren't reduced so much. So while losing the upfront price reduction is disappointing, you may find that you can make a good part of it up with better resale values a few years later.


That's true, but the problem is that the used car values reflect the credit regardless of whether the owner received it. It will be a long time until the first batch of cars sold with the credit intact are out of circulation. If we don't get the credit, we'll be competing with the owners that did, and our resale values will suffer for it. Of course that's true regardless of when the credit runs out; it's really salt in the wound for no-credit buyers in the year of the transition from credit to none.


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## M3OC Rules (Nov 18, 2016)

Tesla Newbie said:


> That's true, but the problem is that the used car values reflect the credit regardless of whether the owner received it. It will be a long time until the first batch of cars sold with the credit intact are out of circulation. If we don't get the credit, we'll be competing with the owners that did, and our resale values will suffer for it. Of course that's true regardless of when the credit runs out; it's really salt in the wound for no-credit buyers in the year of the transition from credit to none.


If it runs out at the end of the year there won't be many people that get the credit. If it doesn't then almost all the early or even not so early reservation holders should get all or half. And you shouldn't be getting the credit if you sell it right away so I'm not sure this is much of an issue.

There may be more demand than supply in say 2019 or longer for new Model 3's. Its hard to know the real demand until you can actually go to the store and buy one without waiting a year. The short term used market could be worse for no supply and high demand. Then long term the car will still get software updates, could realize full self driving, will likely still have the best charging network, and should last several hundred thousand miles if taken care of. This is unique to Tesla for at least the next couple years. The counter is if there are reliability or initial quality issues. Or if improvements to future Model 3's or other competition make the older ones less desirable. Some new battery technology comes along. Everyone stops buying cars because autonomous car services make them unnecessary. Tesla goes bankrupt.<Gulp I didn't just say that> As good as the Model 3 sounds though I'm optimistic the resale value could be quite high given the situation.


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## SoFlaModel3 (Apr 15, 2017)

slasher016 said:


> I guess I'm in the minority of the board, but I consider the credit a nice to have. I'm buying a Model 3 (if I don't break down and buy a model S -- which I really shouldn't at my income level) regardless and consider the credit as a cherry on top.


I'm right there with you. The credit is just the icing on the cake.


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## SolarPro (Aug 5, 2017)

John Slaby said:


> So, this is a bit off the topic, but I respect the opinions of this group so I'm going to ask you anyway.
> 
> As a result of becoming part of the Model 3 illuminati, I have become much more environmentally aware and have decided to take the plunge and get solar (with a goal of becoming grid-independent). I have evaluated a number of providers and, while the bias is probably evident, I have decided to go with Tesla.
> 
> ...


The articles I have read so far on the solar ITC and this tax plan indicate that it has a lot of backing on both sides of the aisle. Essentially, it already went through a tax cut at the end of 2016. I'm not so much worried about the ITC as I am the the new tariff on imported panels that may be enacted very soon. The proposed tariff is 30-35%, with only a very few companies exempt, but the President can revise that to whatever he wants. Get the panels as soon as you can, they may not be cheaper for a long time.


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## JWardell (May 9, 2016)

I should clarify, I will be getting a Model 3 with or without the tax credit. And I'll be stretching my wallet either way.
But without the credit I will be stretching way too far and forced to go with standard range battery. Along with the extra three month wait required for it.
THAT's why I'm upset about losing it.


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## Chris Hardesty (Mar 27, 2017)

This is exactly my situation as well. The wait was already killing me and now with the production delay and potentially losing the tax credit I've gone from a few months away from getting my model 3 to potentially half a year. Patience is hard. 



JWardell said:


> I should clarify, I will be getting a Model 3 with or without the tax credit. And I'll be stretching my wallet either way.
> But without the credit I will be stretching way too far and forced to go with standard range battery. Along with the extra three month wait required for it.
> THAT's why I'm upset about losing it.


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## Tesla Newbie (Aug 2, 2017)

DC Rules said:


> If it runs out at the end of the year there won't be many people that get the credit. If it doesn't then almost all the early or even not so early reservation holders should get all or half. And you shouldn't be getting the credit if you sell it right away so I'm not sure this is much of an issue.
> 
> There may be more demand than supply in say 2019 or longer for new Model 3's. Its hard to know the real demand until you can actually go to the store and buy one without waiting a year. The short term used market could be worse for no supply and high demand. Then long term the car will still get software updates, could realize full self driving, will likely still have the best charging network, and should last several hundred thousand miles if taken care of. This is unique to Tesla for at least the next couple years. The counter is if there are reliability or initial quality issues. Or if improvements to future Model 3's or other competition make the older ones less desirable. Some new battery technology comes along. Everyone stops buying cars because autonomous car services make them unnecessary. Tesla goes bankrupt.<Gulp I didn't just say that> As good as the Model 3 sounds though I'm optimistic the resale value could be quite high given the situation.


All good points. And, to be clear, I plan to hold on to and enjoy my car (and it's sister Model Y whenever that comes along) for the long term. Resale value makes for an interesting conversation, but is irrelevant in my garage.


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## RadDr (Nov 6, 2017)

The tax credit is based only on the date it is put in service. You could register the car when you receive it and turn around and sell immediately. There is nothing on the form about when you sold the vehicle. Here is the pdf for the IRS tax form:

https://www.irs.gov/pub/irs-pdf/f8936.pdf

Although IRS publication IRC 30D states "The vehicles must be acquired for use or lease and not for resale," there is no documentation required for proof of length of ownership or a sale date. This does not really apply to the individual owner.


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## Bokonon (Apr 13, 2017)

Somewhat unsurprisingly, Senator Dean Heller (R - Nevada, up for re-election in 2018) has voiced support for keeping the tax credit.



> Bloomberg Terminal reported today that Republican Senator Dean Heller, who sits on the Senate's finance committee, said that he will fight against the repeal of the federal tax credit for electric vehicles in an interview: "I'll be doing my best to try to protect that kind of tax credit that keeps the industry afloat."


(source)

While I don't agree with his statement that the tax credit is "keeping the industry float," and while it's entirely possible that he's just paying lip-service to his state's relationship with the Gigafactory, I nevertheless find his remarks encouraging.


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## Ode to Joy (Mar 11, 2017)

Hope everyone who is watching this Tax Cut/Reform Bill is contacting their congressman and senators. They should either keep the current EV Tax credit ($7,500.) as written or better yet extend it to 1 million vehicles sold until the phase out starts.
Otherwise, if they insist on cutting this provision then lets also eliminate oil and gas tax breaks and instigate a carbon tax too. It also would not hurt to raise the federal gasoline tax since this would help fund road and bridge repair which is sorely needed. I am calling my congressman and senators today. Just my thoughts on this portion of the tax bill.


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## TesLou (Aug 20, 2016)

Anyone who didn’t see this coming a year ago is as delusional as the man who’s ultimately responsible for this action. Thankfully, the Republican senator from Nevada sits on the finance committee and will hopefully do everything he can to protect that “yuge” employer he has sitting out there in Sparks.


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## MelindaV (Apr 2, 2016)

a revised version of the bill is expected to be released Thursday (according to the email from Plug in America), so it'll be interesting to see how much of the tax credits & deductions get left as is vs stripped as the current HR1 shows.


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## Skione65 (Apr 4, 2016)

Not all 'Hope' is lost. This is some semblance of 'Good News' I hope in the battle to keep the Tax Credit alive in whatever form the bill takes.

"Electric Vehcle Buyers Get an Ally within GOP Over Repeal of the $7500 Yax Credit"

https://electrek.co/2017/11/07/electric-vehicle-buyers-federal-tax-credit/

Ski


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## garsh (Apr 4, 2016)

TesLou said:


> Anyone who didn't see this coming a year ago is as delusional as the man who's ultimately responsible for this action.


Tone down the rhetoric, please. You've just called people who disagree with you "delusional".

I still maintain that the other automakers will lobby to keep this incentive. Tesla only really needs it for the short term. Ford will need it later when they finally get their act together and start putting out a real EV.


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## @gravityrydr (Apr 12, 2016)

I would be OK with a revision of the tax code to limit the rebate to vehicles to $55,000 $60,000 or less or setting an income limit. It is the lower to mid-level part of the market that needs the boost.


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## Mark C (Aug 26, 2016)

danzgator said:


> And they never even made the lowest end 40 because of low demand. They just gave those buyers a software limited 60.


I remember seeing a Model S 40 for sale ~ 6 months or so ago. Don't remember too much about it except, I distinctly remember thinking, "I didn't think they actually sold any 40 kWh battery cars."


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## garsh (Apr 4, 2016)

@gravityrydr said:


> I would be OK with a revision of the tax code to limit the rebate to vehicles to $55,000 $60,000 or less or setting an income limit. It is the lower to mid-level part of the market that needs the boost.


Be careful what you wish for. Pennsylvania updated their rebate to have a vehicle cost limit of $50k, including destination fees. So no rebates for those who buy First Production.


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## BoRidge (Sep 14, 2017)

garsh said:


> Be careful what you wish for. Pennsylvania updated their rebate to have a vehicle cost limit of $50k, including destination fees. So no rebates for those who buy First Production.


Right?!? I'm okay with the rebate being limited, but only so long as it is limited in a way that I still qualify [sarcastic voice].


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## McHoffa (Jan 26, 2017)

The most fair way would be to just give a federal subsidized discount to everyone that's the same amount for everyone. Let's say it's $5000, and you can only claim it a single time. 

Currently someone could buy four Teslas and get four tax credits in the same year (if they can buy four Teslas, they have enough tax liability to get four credits worth). Meanwhile a person who makes $50k with kids and buys a Nissan Leaf can't get much of any discount. It definitely favors upper middle class to upper class. 

Still, I hope it doesn't change for my sake until after next year


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## Bokonon (Apr 13, 2017)

garsh said:


> Be careful what you wish for. Pennsylvania updated their rebate to have a vehicle cost limit of $50k, including destination fees. So no rebates for those who buy First Production.


Yeah, I'm not at all a fan of how Pennsylvania did that. When the adoption of a new technology (or, more generally, a new behavior) is the primary motive behind an incentive, you want to give as many people as possible a reason to go along with it. Implementing the incentive as a one-step step-function to $0 -- at a middle-of-the-current-market value, no less -- is not going to help you achieve that goal, especially not when you're essentially disqualifying a significant portion of the current market.

By contrast, the MOR-EV program here in Massachusetts draws the line at $60K (base MSRP), and provides a $2500 rebate for all vehicles under that amount and $1000 for all vehicles above it. I like this approach because all vehicles qualify for the incentive, even if the rebate for >= $60K models is relatively small as a percentage of the purchase price, because it ensures that all EV-buyers receive some kind of reward for their decision. (And I wouldn't discount the irrational/emotional value that we assign to rewards of any size -- e.g., would you rather have a miniature, Halloween-sized candy in front of you right now, or nothing at all? )

The one thing I'd want to add to an incentive structure like this (having zero public-policy experience ) would be some kind of sliding-scale, income-based rebate (say, another $0 - $2000 in $500 increments, depending on prior-year AGI less the cost of housing) for models with base MSRP <= $35K (). The goal would be to create additional demand for / adoption of shorter-range EVs near urban centers, where drivers are most likely to spend more time sitting idle in traffic, at stop lights, in school pick-up lines, etc., generating CO2 and other unwanted emissions in the process.


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## mtdoak (Aug 1, 2017)

Honestly, I don't think we are going to see a "change" to the credit as (and correct me if I'm wrong) would require a standard vote in senate rather than the 51 vote backdoor stuff they are doing for the tax bill. I honestly believe this is an all or nothing kind of thing. The big goal of the tax bill is to appease the donor class that essentially runs the republican party at this point. The house bill is a "piss off democrats bill" and cut so much they'll be able to say they "compromised" while still passing a bill that cuts taxes for large businesses and the ultra rich. 

It's the old "low ball" strategy.


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## Petra (Sep 12, 2017)

Due to the way the credit works, one can can assume that it really wasn’t intended to meaningfully help lower income households outside of leasing situations (even then, it depends on how much of the credit the lessor decides to pass on to the lessee) and through pushing used EV prices down. The credit is an extra little push to get those with the money to spend it in a particular way (or spend it at all)--it's about building a market for a developing technology and helping the companies involved reach a level of scale which brings prices down, not helping individuals. Would I have bought a Model S without the $7500 tax credit and $2500 CA rebate back in 2015? Hard to say... it was already more than twice as expensive as any car my wife and I had ever bought, but that's largely because we've never really viewed more expensive cars as being worth their new car asking price. Actually, without the incentives, we wouldn’t have leased a Leaf in 2012 which, despite being...a Leaf, is the car that sold us on EVs being ready which, in turn, means that we may not have bought the Model S (at least, not when we did) and may not have reserved a Model 3 to replace one of our other cars that doesn’t need replacing.

Looking at it that way, the incentives worked in prodding us into engaging in commerce and spending money that we otherwise wouldn’t have, all in a way which benefited the target market. Come to think of it, we probably wouldn't have bought our Accord had it not been for this chain of events unfolding... but that's another story.


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## ummgood (Feb 13, 2017)

Tesla Newbie said:


> That's true, but the problem is that the used car values reflect the credit regardless of whether the owner received it. It will be a long time until the first batch of cars sold with the credit intact are out of circulation. If we don't get the credit, we'll be competing with the owners that did, and our resale values will suffer for it. Of course that's true regardless of when the credit runs out; it's really salt in the wound for no-credit buyers in the year of the transition from credit to none.


Actually I believe the opposite is the case. It doesn't matter if the original purchaser got the credit or not. What matters is if the person interesting in buying a Model 3 CAN currently get a credit on a new car. If they CAN get a credit on a new car then they will avoid a used car that costs more than the new car so the cost of the used car has to be less than the new cost - tax credit. For example say there is no supply demand issue then you can't expect someone to pay more than $27,500 for a used base Model 3 if someone can go buy a brand new one for 35k - 7500 tax credit.

After the tax credit is lifted if the used model 3 is say 32.5k and a new one is 35k someone might choose used because they can save 2500 off of the new price. Even if the original purchaser got the car for 27.5k that doesn't matter to the buyer.


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## Ode to Joy (Mar 11, 2017)

garsh said:


> Tone down the rhetoric, please. You've just called people who disagree with you "delusional".
> 
> I still maintain that the other automakers will lobby to keep this incentive. Tesla only really needs it for the short term. Ford will need it later when they finally get their act together and start putting out a real EV.


One can hope that the traditional automakers have seen the future being electric and will push Congress to maintain the tax credit or, even better, restructure the credits so that it strengthens the EV revolution. Can't help but also think that China could push these old automakers into the EV realm when they require EVs to be a bigger part of the mix in China. China is too big of a growing market to ignore, IMHO.


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## @gravityrydr (Apr 12, 2016)

mtdoak said:


> (and correct me if I'm wrong) would require a standard vote in senate rather than the 51 vote backdoor stuff they are doing for the tax bill. .


_/Begin civics rant. /_
I think what you are referring to is a process known as "Reconciliation", this allows legislation to pass with only a simple majority of 51 votes. For a bill to be considered under Reconciliation, it must not add to the federal deficit after 10 years, this is part of the "Byrd Rule". If portions of the legislation do not adhere to the Byrd rule, they can be subjected to the regular 60-vote threshold. Reconciliation can only be used once a year per topic.
https://en.wikipedia.org/wiki/Reconciliation_(United_States_Congress)
The major sticking point is that the current bill increases the Federal deficit by $1.7 trillion over 10 years. A workaround to the deficit restriction can be sunset some tax breaks earlier to reduce the cost.
http://www.reuters.com/article/us-u...-7-trillion-to-deficit-cbo-idUSKBN1D82S2?il=0
The House Republican tax plan called the "Tax Cuts and Jobs Act", is not actually a bill yet it is just an outline. The Senate plans to release its own proposal this week that is likely to be different, these differences will need to be combined in committee.
A quick read on the topic is here: http://time.com/5012233/gop-tax-reform-congress/
_/End civics rant./_


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## tivoboy (Mar 24, 2017)

I think it will be more telling to see what is in the SENATE plan that should be out today...what is really odd and IMHO just vindictive is changing the goal posts after the fact. This credit was initially approved for X number of years and Y of $$'s, and it was renewed in a bi-partisan vote more than once. (across houses). Everyone saw the opportunity to support and help develop and industry, in order to compete with foreign competitors. Now, based on pretty much just one person, we have it being pulled for reasons that have nothing to do with national planning or industry support.


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## Bearlytiger (Sep 13, 2017)

I didn't realize that Donald Trump wrote the House tax bill. That is interesting.


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## mkg3 (May 25, 2017)

Clearly I'm in the minority. I'm perfectly fine with the Fed subsidy going away.

At the end of the day, a viable product will survive and price will be competitive. Frankly, it has done its job to jump start EV viability and now is up to the private industry to run with it.

It has no impact on my purchase decision. I put solar panels up and rebates were not part of the decision criteria for me (was a windfall). It was simply lowering the monthly outlay to the local utility company and know what my commitment is to electricity month-to-month. It used to fluctuate significantly when we ran AC during the summer months.

I prefer the notion of simpler smaller government and let the free marketplace determine the fate of anything - including technology.

Of course I prefer 15% flat tax on EVEYONE and get rid of IRS completely..... The tiered taxation to penalize success is ridiculous as we have it now.


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## Bearlytiger (Sep 13, 2017)

Amen! In the minority on this board, “yes”, in the minority in this country heck “no”.


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## Bokonon (Apr 13, 2017)

The Washington Post is reporting that the Senate version of the tax bill preserves the EV credit:



> Sen. John Hoeven also told reporters that the top tax rate for individuals, currently set at 39.6 percent, would drop to 38.5 percent under the draft Senate measure.
> 
> The South Dakota Republican said the measure also preserves existing clean energy tax incentives such as for electricity production from wind. *It preserves a tax credit for electric cars as well*.


(source - H/T nikeykid)


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## tivoboy (Mar 24, 2017)

Bokonon said:


> The Washington Post is reporting that the Senate version of the tax bill preserves the EV credit:
> 
> (source - H/T nikeykid)


several sources reporting the same.. dean heller was pushing hard for it to stay.


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## tonymil (Aug 2, 2017)

mkg3 said:


> ....I'm perfectly fine with the Fed subsidy going away.


GM and Nissan disagree with you.
https://cleantechnica.com/2017/11/0...ists-working-defend-us-federal-ev-tax-credit/



mkg3 said:


> ....Of course I prefer 15% flat tax on EVEYONE and get rid of IRS completely..... The tiered taxation to penalize success is ridiculous as we have it now.


The U.S. income tax has always been progressive, it has never been a "flat tax":

https://www.infoplease.com/business-finance/taxes/history-income-tax-united-states

And the best years of economic growth in the U.S. occurred in the 1950's (when we also had low income disparity) which coincides with the highest marginal income tax rates we've ever had:

https://web.stanford.edu/class/polisci120a/immigration/Federal Tax Brackets.pdf

So, high growth while we had high taxes. Imagine that. And by the way, that 91% tax in 1960 on income over $400,000 that would be income over $3 million in today's dollars. Yet wealthy people scream about today's top marginal rate of 39%. Get over it.


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## mkg3 (May 25, 2017)

tonymil said:


> GM and Nissan disagree with you.
> https://cleantechnica.com/2017/11/0...ists-working-defend-us-federal-ev-tax-credit/
> 
> The U.S. income tax has always been progressive, it has never been a "flat tax":
> ...


Lol.... You're funny and so serious.

Naturally GM and Nissan and for that matter probably every car manufacture with EVs including Tesla, would disagree with my statement...dahhh.

As for flat tax, its a concept and just my preference. No need to defend our tax system. I am perfectly aware of our system. It is what it is. Just look what the Senate did today. The Senate Republican plan has 7 brackets and restored bunch of credits, like the EV credit we're discussing, back in. They don't get it. Business as usual and career politician don't know what they don't know - No sense of urgency or simplification. Its job security for them....


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## garsh (Apr 4, 2016)

This thread has become too political.
Locked.


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## TSLA_Model<3 (Nov 14, 2016)

Dual Motor current says: Mid 2018. 
Do you think, we can take advantage of full federal tax credit ? ($7,500)

I am assuming that depends if Tesla can push off selling 200,000 vehicle in USA by selling to Canada. 
Can anyone confirm that is what Tesla is planning to do? 

I just got my email to configure Model 3. (3/31/2016 non-owner, online reservation) but would like to defer my order and wait for dual-motor if I am able to get it with full federal tax credit later in the year. 

If anyone has any information on this, appreciate your comment. 

thx


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## garsh (Apr 4, 2016)

The best guess is probably in the delivery estimator.


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## TSLA_Model<3 (Nov 14, 2016)

Delivery estimator just says mid 2018


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## NJturtlePower (Dec 19, 2017)

Defer as long as you're willing to wait, thousands of us in the same boat, but nobody knows when AWD will be released besides Tesla. Most agree that until the demand for the RWD LR First Production dies down there no need to complicate production or offer any more options. Currently the configuration rate is 75%+

Tesla will LIKELY hit 200k this quarter so at earliest you'll have until September 30th to take delivery for the full $7500. If they push to Q3 you'll have until the end of the year.

You really need AWD for the 10 or less days we actually see snow here anyways? Proven that the 3 will handle light snow just fine and more so with true winter tires.


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## TSLA_Model<3 (Nov 14, 2016)

Snow is secondary reason eventhough it did snow alot in jersey this year 

Would like it for better driving ride, faster t 0-60, slightly better range.


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## TSLA_Model<3 (Nov 14, 2016)

I thought Tesla trying ship most of production to Canada to hit 200k in July?


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## garsh (Apr 4, 2016)

cupid_TM3 said:


> Delivery estimator just says mid 2018


Sorry, I meant Troy's Deliver Estimator.
It didn't embed very well.


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## garsh (Apr 4, 2016)

cupid_TM3 said:


> Snow is secondary reason...


Read this:
Worried About Snow? Don't Dismiss Getting Rear Wheel Drive!


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## Veedio (Sep 25, 2016)

cupid_TM3 said:


> I thought Tesla trying ship most of production to Canada to hit 200k in July?


So they say. Hopefully we'll start seeing some Canadian VINs to prove it. I don't believe any Canadians have one yet.


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## BobLoblaw (Apr 4, 2017)

Veedio said:


> So they say. Hopefully we'll start seeing some Canadian VINs to prove it. I don't believe any Canadians have one yet.


For what it's worth some Canadians received phone calls yesterday (myself included) and we were told "by the end of June". That may be tied to a push for the end of the quarter for exactly the reasons mentioned above, or it could be unrelated. We should know more in the next few weeks...


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## Veedio (Sep 25, 2016)

BobLoblaw said:


> For what it's worth some Canadians received phone calls yesterday (myself included) and we were told "by the end of June". That may be tied to a push for the end of the quarter for exactly the reasons mentioned above, or it could be unrelated. We should know more in the next few weeks...


Yes, I noticed those postings. Doesn't sound like there have been any calls in Ontario which is a bit disconcerting given the election is getting close. Hopefully soon as Trevor alluded.


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## AdamHolmes (Mar 31, 2017)

I considered delaying for the white interior but I'm pretty confident it would make me miss out on full tax credit. I think the same thing about AWD. I think tesla will hit 200k this quarter even if they try to push a lot to Canada . Plus we would be again be behind current owners and line standard when it is made available , most current owners I've spoken to are waiting on AWD


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## Silvermagic3 (Dec 18, 2017)

I'm also waiting for AWD _if_ I can get it with the full tax credit. With the last 3 invite groups all being for the US, I'm assuming Tesla is not trying to push off the 200K number until July. I know there is a slim chance of me getting AWD in Q3, especially since there is probably 10,000+ people ahead of me waiting for the same thing (I just got my invite yesterday). But, I also don't think there is any harm in waiting until July. I don't need a new car right now and another .25% bump in interest wont move my payment to much.

I figure if AWD drive is something that will happen in Q3 we will know by the NHTSA VIN registrations. If we see DM VINs in late June or early July, then I'll have some hope of getting the AWD before the end of September, but if not I'm fine with First Production. Since the current lead time from config to deliver is no longer then 60 days, I feel safe in ordering no later then the end of July and still being able to get my car in September.


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## dmbooth (Nov 9, 2017)

Silvermagic3 said:


> especially since there is probably 10,000+ people ahead of me waiting for the same thing


Come Q3 that's 12 days production ;-)


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## Vendacious (Aug 3, 2017)

NJturtlePower said:


> Currently the configuration rate is 75%+


I'm curious where you got that number. From what I've read the configuration rate is below 50% and Tesla has refused to provide any specifics. It seems like it's all speculation.

My own anecdotal evidence: I know 4 people with a total of 6 reservations between them, and so far only one of those reservations was turned into an order. Of the remaining 5 reservations, two will likely be cancelled (the two people who have two reservations will probably only buy one), two are waiting for AWD, and one is waiting for SR battery.


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## NJturtlePower (Dec 19, 2017)

Vendacious said:


> I'm curious where you got that number. From what I've read the configuration rate is below 50% and Tesla has refused to provide any specifics. It seems like it's all speculation.
> 
> My own anecdotal evidence: I know 4 people with a total of 6 reservations between them, and so far only one of those reservations was turned into an order. Of the remaining 5 reservations, two will likely be cancelled (the two people who have two reservations will probably only buy one), two are waiting for AWD, and one is waiting for SR battery.


Based on the 4,200-ish entries inputed and update on the official "Model 3 Spreadsheet" run by @Troy - Full thread and link here: https://teslaownersonline.com/threads/model-3-invites-spreadsheet.6219/

It's slightly lower than 75% now, 72.7% config rate overall under the "Invite" tab.


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## Silvermagic3 (Dec 18, 2017)

It has seemed like the more recent rounds of invites have had a higher percentage of deferrals. The current round from 4/18 (at 2pm PST 4/19/18) has been hovering around 40%. I wonder if this is because the possibility of other options is getting closer, which makes it easier to wait for.


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## NJturtlePower (Dec 19, 2017)

Silvermagic3 said:


> It has seemed like the more recent rounds of invites have had a higher percentage of deferrals. The current round from 4/18 (at 2pm PST 4/19/18) has been hovering around 40%. I wonder if this is because the possibility of other options is getting closer, which makes it easier to wait for.


I think this is expected as we go forward with first production Model 3's UNTIL lower options are available.... think about it.

I'm speaking in pretty general terms here, but if you consider the progression of invites and the majority in those groups it makes perfect sense.

First was employees and they are taking the car if they bothered to reserve, then previous owners who obviously have the money to take a loaded Model 3 so why not even if its to trade it in on a better one next year, then you have the line waiter/fanboys/big time Tesla fans, they are taking anything to be the first, but now you're getting into the masses who are going to be a bit more picky with options and possibly more budget conscious.


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## ibomark (Feb 21, 2018)

cupid_TM3 said:


> Dual Motor current says: Mid 2018.
> Do you think, we can take advantage of full federal tax credit ? ($7,500)
> 
> I am assuming that depends if Tesla can push off selling 200,000 vehicle in USA by selling to Canada.
> ...


I am in the same boat as you! Just got my config invite but I too am deferring my order. It's very challenging to wait but I too will try and track the rebate status via the forum. Thanks for the post. Mark. April 18, 2018 config date.


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## bradkeller (Nov 14, 2017)

Hi everyone.

I've configured my Model 3, and am awaiting my VIN. 

Because of the timing, I expect to be able to claim the full $7,500 tax credit on my taxes, when I file next year. However, my understanding is that since it's a credit, if I owe less than $7,500, then I don't get the balance. And I can't carry any of it over to another year.

For those of you who have already successfully claimed the credit (probably for a Model S or X), can someone walk me through the math? For example, if I do my taxes and the IRS says I owed $22,000 in taxes for 2018, and I had $21,000 withheld through my paycheck, I would normally owe the IRS $1,000 ($22,000-$21,000). 

But if I also claim the credit, where does that $7,500 come off of? 

Does it come off of the entire amount of taxes owed (i.e., I'd now actually "owe" $14,500 ($22,000-$7,500) in taxes and therefore would get a refund of $6,500 ($21,000 I already paid minus the $14,500 I now owe)? 

Or does it come out of the amount I need to pay them after I file the taxes (i.e., instead of writing them a check for $1,000, I'd now owe $0 and forfeit the other $6,500)?

This may sound like a dumb question, but I haven't been able to find info on it anywhere. And I don't want to leave money on the table in April 2019 because I didn't do my research. 

Thanks for any help.


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## Brett (Aug 1, 2017)

bradkeller said:


> Does it come off of the entire amount of taxes owed (i.e., I'd now actually "owe" $14,500 ($22,000-$7,500) in taxes and therefore would get a refund of $6,500 ($21,000 I already paid minus the $14,500 I now owe)?


This is correct.

You'll get the full credit as long as long as your total tax liability (the $22,000 you owe) is higher then $7500. It's doesn't matter how much you have withheld.


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## SoFlaModel3 (Apr 15, 2017)

@Brett is right and you can adjust your withholding more now and begin chewing away at the $7500 if you'd like though I have opted not to do that in fear that somehow the credit gets retroactively canceled and I have to pay it back


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## wheelers (Apr 23, 2018)

Jumping in here because taxes are NOT my thing- but if we typically get a refund (this year it was $300) will we get the $7500 as an additional refund? I am aware that some of the laws are changing & many of our write offs may not be available next year- but like previous poster- I don't want to leave the 7500 on the table! Thanks!


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## SoFlaModel3 (Apr 15, 2017)

wheelers said:


> Jumping in here because taxes are NOT my thing- but if we typically get a refund (this year it was $300) will we get the $7500 as an additional refund? I am aware that some of the laws are changing & many of our write offs may not be available next year- but like previous poster- I don't want to leave the 7500 on the table! Thanks!


You may get $7,800. Whether you get a refund or owe at the end of the year is irrelevant. The $7,500 tax credit is based on your final tax liability for the year.

If your tax liability is less than $7,500, the credit caps at your tax liability. If your tax liability is $7,500 or more, you'll get the full credit.


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## kenforum (Apr 30, 2018)

I will be purchasing the M3 under my name but I do joint tax return with my wife. So can “I” still get the tax credit if filing joint tax return, or I have to file separately from my wife to get the credit? Thanks guys.


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## Runt8 (May 26, 2017)

kenforum said:


> I will be purchasing the M3 under my name but I do joint tax return with my wife. So can "I" still get the tax credit if filing joint tax return, or I have to file separately from my wife to get the credit? Thanks guys.


The tax credit can be claimed regardless of if you're filing a joint or single return, as long as your name is on the return. Unless you're asking how to keep your wife from cashing the return check 

Another thing that is useful when talking about the tax credit is to not use the word "owe" as this has two different meanings when a layperson talks about taxes. It can either mean the total amount you will need to pay for the entire year (which is known as your liability), or it can mean the amount you are short and will need to pay when you file your taxes.

The easiest way to calculate how the tax credit affects you:
1. Determine your total tax liability (how much you will need to pay for the entire year, regardless of withholdings).
2. Subtract $7500 - however, since this is a tax credit and not a refund, this number can not go below 0.
3. Subtract any prepayments or withholdings you have already made. If this number is less than zero, you will be getting a refund check. If it's greater than 0, you will still owe when you file.


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## PTC Gator (Sep 3, 2017)

It might help if someone with tax savvy could put up a simple table that shows income brackets vs standard deductions to get a feel for a ballpark minimum income needed to generate a $7500 tax liability.

I found this in a Forbes article,


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## Derik (Jul 26, 2017)

PTC Gator said:


> It might help if someone with tax savvy could put up a simple table that shows income brackets vs standard deductions to get a feel for a ballpark minimum income needed to generate a $7500 tax liability.
> 
> I found this in a Forbes article,


So that means if your taxable income great than $47,385 you'll owe at least $7,500.
5328.75 + 0.25*(47385-38700) = 7500


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## SoFlaModel3 (Apr 15, 2017)

Derik said:


> So that means if your taxable income great than $47,385 you'll owe at least $7,500.
> 5328.75 + 0.25*(47385-38700) = 7500


Just remember other deductions and credits will take priority so it's not an exact but rather just a guide.


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## LV Acrobat (Dec 29, 2017)

Quick question, do I need to file anything now to be included in the pre 200,000 cars tax incentive? Or is my VIN what holds the information. Worried Ill procrastinate and miss my chance. Just making sure my car will be included so I can benefit from the incentive. Thanks everyone!


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## Dr. J (Sep 1, 2017)

LV Acrobat said:


> Quick question, do I need to file anything now to be included in the pre 200,000 cars tax incentive? Or is my VIN what holds the information. Worried Ill procrastinate and miss my chance. Just making sure my car will be included so I can benefit from the incentive. Thanks everyone!


You will file form 8936 with your 2018 tax return next spring. Nothing else to worry about beforehand.


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## SoFlaModel3 (Apr 15, 2017)

It’s not your VIN that matters it’s the date the car is registered that makes the determination on the amount of credit so you’re good as long as you get the car before it ratchets down 50% to the next bracket.


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## Dr. J (Sep 1, 2017)

SoFlaModel3 said:


> It's not your VIN that matters it's the date the car is registered that makes the determination on the amount of credit so you're good as long as you get the car before it ratchets down 50% to the next bracket.


In his signature: 
Delivery: 4/03
(presumably 2018)


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## MelindaV (Apr 2, 2016)

rodrigst said:


> I hope the reason for the delay is to ensure the incentive gets maximum impact as I don't know if I can financially justify the purchase w/o the tax rebate.
> 
> I've never bought a new car before and am somewhat philosophically against that idea, but would happily support a movement like this and get a great car - but it has to make financial sense. My wife is against it, so I am hoping the rebate is still applicable when I am offered to configure.


credit, not rebate ... but it will be at least 100% ($7500) thru September, then 50% the next 6 months and 25% the following 6 months - with a 3 month bump out if the 200k is delivered in July. so it is not so much an immediate loss of the credit.


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## summerfun (Jan 22, 2018)

rodrigst said:


> I hope the reason for the delay is to ensure the incentive gets maximum impact as I don't know if I can financially justify the purchase w/o the tax rebate.
> 
> I've never bought a new car before and am somewhat philosophically against that idea, but would happily support a movement like this and get a great car - but it has to make financial sense. My wife is against it, so I am hoping the rebate is still applicable when I am offered to configure.


rod, bear in mind it is not a rebate. The FITC is a credit against any other taxes you owe on your return. If you do not owe any tax you get zip. If your tax bill is only $3,000 you will only get $3,000 in credit. To get the full amount you will need to have a tax liability of $7,500 or more. This is a non-refundable tax credit meaning it can only help lower your tax liability to $0. For more information, you can look up form 8936 on www.irs.gov Here is a link to what I think is the best explanation ever written in laymen's terms. https://cars.usnews.com/cars-trucks/how-does-the-electric-car-tax-credit-work


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## ChicagoAwd3 (Jun 5, 2018)

summerfun said:


> rod, bear in mind it is not a rebate. The FITC is a credit against any other taxes you owe on your return. If you do not owe any tax you get zip. If your tax bill is only $3,000 you will only get $3,000 in credit. To get the full amount you will need to have a tax liability of $7,500 or more. This is a non-refundable tax credit meaning it can only help lower your tax liability to $0. For more information, you can look up form 8936 on www.irs.gov Here is a link to what I think is the best explanation ever written in laymen's terms. https://cars.usnews.com/cars-trucks/how-does-the-electric-car-tax-credit-work


I'm not seeing it that way. It's based off your tax liability for the year. Not what you owe at the end of the year. If somebody paid 7500 to the federal government in taxes, the tax credit will get applied to the taxes they already paid. That means they will receive a $7500 back as a refund. 
You are right by saying it will bring the amount owed down to zero if they owe 7500 or less. But the key phase is tax liability for the year.


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## Dl6684 (Sep 26, 2017)

Joseph Mullan said:


> I'm not seeing it that way. It's based off your tax liability for the year. Not what you owe at the end of the year. If somebody paid 7500 to the federal government in taxes, the tax credit will get applied to the taxes they already paid. That means they will receive a $7500 back as a refund.
> You are right by saying it will bring the amount owed down to zero if they owe 7500 or less. But the key phase is tax liability for the year.


Well, it's to make sure people don't think it's -$7500 on the price of the car. I personally owe $9500 on my Audi (maybe less whenever I get that we'll anticipated invite)...I'm going to pay off the Audi, keep it, but will get $7500 back next Feb- April so essentially I'm paying the car off and just going without the money until then. Not everyone have saved money well and don't like that idea, but that's really the difference. A rebate is a lot quicker to get the money than the tax credit.


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## Ryan Ballantyne (May 21, 2018)

Dl6684 said:


> Well, it's to make sure people don't think it's -$7500 on the price of the car. I personally owe $9500 on my Audi (maybe less whenever I get that we'll anticipated invite)...I'm going to pay off the Audi, keep it, but will get $7500 back next Feb- April so essentially I'm paying the car off and just going without the money until then. Not everyone have saved money well and don't like that idea, but that's really the difference. A rebate is a lot quicker to get the money than the tax credit.


One could potentially reduce one's withholdings for the year and put the money in a savings account, but I expect that's too much trouble for most people.

Many state incentives are nicer than the federal credit. Colorado, for example, offers a $5000 rebate, and allows you to assign the rebate to the manufacturer, who will knock the $5k off the price of the car. It's essentially an immediate discount.

I never thought I'd say this, but...I hope I owe enough taxes this year to get the full amount. Last year I most certainly did by a wide margin, but this year my tax situation changed (got married, etc...).


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## Dl6684 (Sep 26, 2017)

So, I am no tax expert, but a tax credit is different than a tax deduction.

A tax credit (and feel free to correct me if I'm wrong), can earn you a refund even if you make zero dollars (at least from what I can find on some other credits):

"The IRS offers a number of tax credits that you can take directly off your taxes rather than your income. If the credit is more than you owe in taxes, in some cases, you can claim the excess credit as a refund.
The IRS lists the "additional child tax credit" and the "earned income tax credit" as examples; if you qualify for these credits, you can receive a refund even if you paid no taxes. To claim the credits, you have to file your 1040 and other tax forms."


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## ChicagoAwd3 (Jun 5, 2018)

Dl6684 said:


> Well, it's to make sure people don't think it's -$7500 on the price of the car. I personally owe $9500 on my Audi (maybe less whenever I get that we'll anticipated invite)...I'm going to pay off the Audi, keep it, but will get $7500 back next Feb- April so essentially I'm paying the car off and just going without the money until then. Not everyone have saved money well and don't like that idea, but that's really the difference. A rebate is a lot quicker to get the money than the tax credit.


I'm gonna do something like that. I owe about 10000 on my wife's car. I'm going to put as much of a down payment as I can on the model 3 and use my tax return next year to pay it off. I want to avoid a $900 car note on the tesla. 
Of course this will only work if I get it this year.


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## JEREMY BROOKSBY (Jan 24, 2017)

I’m a little confused. Tesla is showing my final price at 59,900 for the performance with the 20 inch wheel option. I’m going to wait 6 to 12 months to add the enhanced auto pilot. When looking at all the FinePrint it states that all of the tax credits will be applied after purchase? What does that mean? Does the $7500 credit not come off the purchase price? Do I have to submit something to the IRS to get that $7500 credit?


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## Reliev (Jun 3, 2017)

Not an accountant by any means but tax credit is applied during your tax return.


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## RyanB (Jun 29, 2018)

Same (not an accountant) but yes, the credit is a credit you claim on your taxes, and it's not just an automatic $7500 (or $3750, or $1875, whatever it ends up being when you take delivery). It reduces your tax liability by the amount, so you actually have to have acquired at least $7500 in tax liability to get all of it.. If say the taxes on your income/etc only come to $5000, you aren't going to get $7500, you only get $5000, so that's why it's not applied at the time you pay, it's all about your taxes at the end of the year.


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## DR61 (Apr 10, 2016)

JEREMY BROOKSBY said:


> Does the $7500 credit not come off the purchase price? Do I have to submit something to the IRS to get that $7500 credit?


No, credits are taken with your tax return next year. Here is the form (but use the 2018 tax year version next year of course).
https://www.irs.gov/forms-pubs/about-form-8936


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## Sugi (May 31, 2018)

Separate question - I purchased solar for my home this year and am expecting the 30% return from that. Will I still qualify for the $7500 from the vehicle?


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## sk3p (Jun 29, 2018)

"If they're being clever, the automakers will make sure they sell that inauspicious car at just the right time. If Tesla hits the number on June 30, at the end of the second quarter, then buyers of its cars only have until the end of September to secure the full credit. If it makes the sale on July 1, buyers enjoy the $7,500 until the end of the year. "

I read this on wired.com and was very curious as to what this actually meant. I'm wondering how/why this relates to the "order before July 1 to receive..." where they give the extra data plan included as a promo. Why are they pushing sales before the end of the quarter, and will this hurt our chances at tax rebate, as quoted above?


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## MelindaV (Apr 2, 2016)

Sugi said:


> Separate question - I purchased solar for my home this year and am expecting the 30% return from that. Will I still qualify for the $7500 from the vehicle?


The solar credit can carry over to the next year if you do not have enough tax liability for both the car and it (whereas the car's credit can not). 
So if you have 10,000 of liability for 2018, you could get the $7500 and $2500 of your solar credit; remaining solar credit carried over to 2019.


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## MelindaV (Apr 2, 2016)

sk3p said:


> "If they're being clever, the automakers will make sure they sell that inauspicious car at just the right time. If Tesla hits the number on June 30, at the end of the second quarter, then buyers of its cars only have until the end of September to secure the full credit. If it makes the sale on July 1, buyers enjoy the $7,500 until the end of the year. "
> 
> I read this on wired.com and was very curious as to what this actually meant. I'm wondering how/why this relates to the "order before July 1 to receive..." where they give the extra data plan included as a promo. Why are they pushing sales before the end of the quarter, and will this hurt our chances at tax rebate, as quoted above?


The two are unrelated. They are pushing orders so they get the extra $ recorded in Q2 and will be able claim the number of vehicles in transit. The orders do not count toward the tax credit, just deliveries (paid in full, registered, driven off by customer).


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## Love (Sep 13, 2017)

sk3p said:


> "If they're being clever, the automakers will make sure they sell that inauspicious car at just the right time. If Tesla hits the number on June 30, at the end of the second quarter, then buyers of its cars only have until the end of September to secure the full credit. If it makes the sale on July 1, buyers enjoy the $7,500 until the end of the year. "
> 
> I read this on wired.com and was very curious as to what this actually meant. I'm wondering how/why this relates to the "order before July 1 to receive..." where they give the extra data plan included as a promo. Why are they pushing sales before the end of the quarter, and will this hurt our chances at tax rebate, as quoted above?


They're separate things, an order does not qualify you for the credit, only a delivery of a vehicle. The "before July 1st" has been speculated here and elsewhere to be so Tesla has a cash influx prior to their Q2 earnings call and to fill their coffers heading into the expected HUGE Q3 ahead of them. They're incentivizing people with open configurations to get in before July 1st by making that the cutoff for free data. 
The idea being they'll save the 200,000th delivery for early July (Q3) and have ALL of Q3 and Q4 for the full $7500 regardless of what total number of cars they deliver.


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## c2c (Sep 19, 2017)

sk3p said:


> "If they're being clever, the automakers will make sure they sell that inauspicious car at just the right time. If Tesla hits the number on June 30, at the end of the second quarter, then buyers of its cars only have until the end of September to secure the full credit. If it makes the sale on July 1, buyers enjoy the $7,500 until the end of the year. "
> 
> I read this on wired.com and was very curious as to what this actually meant. I'm wondering how/why this relates to the "order before July 1 to receive..." where they give the extra data plan included as a promo. Why are they pushing sales before the end of the quarter, and will this hurt our chances at tax rebate, as quoted above?


The $2500 non-refundable deposit is revenue in Q2 without delivering a car. A delivered car counts against the 200k trigger that begins the federal tax credit sunset.
So money in Q2 helps Q2 financial, to be reported the first week of August.
Lots of cars delivered in Q3, July 1 and later, help profitability for Q3, reported in the first week of November. The Q3 and Q4 numbers are Elon's focus, but since Tesla is a lighting rod for drama and short sellers, a ton of $2500 payment will be a good thing.
And the feeding frenzy of invitations worked on me. I purchased far more car than my ration mind ever considered. (Full Self Driving.) Or will need.
But this is not about 'NEED.'


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## Ed Woodrick (May 26, 2018)

JEREMY BROOKSBY said:


> I'm a little confused. Tesla is showing my final price at 59,900 for the performance with the 20 inch wheel option. I'm going to wait 6 to 12 months to add the enhanced auto pilot. When looking at all the FinePrint it states that all of the tax credits will be applied after purchase? What does that mean? Does the $7500 credit not come off the purchase price? Do I have to submit something to the IRS to get that $7500 credit?


The US IRS Tax Credit is a tax credit. You will need to file for the credit next year when you do your taxes. If you do not have 7500 in taxes, whoops, you will not get the full credit.

Also, don't forget local tax, tag, and title registration fees, that's often another 4k on top of the price.

If you were to do a lease, which is not available through Tesla, then the IRS Tax credit would by applied for by the title holder (i.e. Tesla's bank) and would impact lease cost.

But yes, for example, the $35,000 vehicle will require about $40,000 to drive it off of the lot. You will then get back, as a tax credit, $7,500 next year.

Oh, and it you don't get the vehicle this year, it will be on the next year's taxes.


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## harrison987 (Jun 30, 2018)

Hey guys,

From what I understand, Tesla hit hit 200,000 mark a couple weeks ago.

I placed my order June 30...and the ordering page indicated the tax credit.

My car was manufactured first week of July.

Delivery date was July 16, but due to a paint imperfection was postponed until July 21.

From what I understand, the credits went bye-bye after the 200,000 mark...so how will I know if my car qualifies?

mmmmmmm...


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## SoFlaModel3 (Apr 15, 2017)

harrison987 said:


> Hey guys,
> 
> From what I understand, Tesla hit hit 200,000 mark a couple weeks ago.
> 
> ...


As long as you personally qualify (your tax liability is at least $7,500) then you will get the full credit. It's a phase out. The $7,500 portion of the credit is for all US cars delivered on or before 12/31/2018.


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## harrison987 (Jun 30, 2018)

thanks man!!!



Mike


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## SoFlaModel3 (Apr 15, 2017)

harrison987 said:


> thanks man!!!
> 
> 
> 
> Mike


You're welcome and enjoy that Model 3!!


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## Stewie Lie (Jul 1, 2018)

SoFlaModel3 said:


> As long as you personally qualify (your tax liability is at least $7,500) then you will get the full credit. It's a phase out. The $7,500 portion of the credit is for all US cars delivered on or before 12/31/2018.


Your tax liability doesn't mean what you owe or get back when you file the return right? I read that it should be line 63 on 1040 form.


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## SoFlaModel3 (Apr 15, 2017)

Stewie Lie said:


> Your tax liability doesn't mean what you owe or get back when you file the return right? I read that it should be line 63 on 1040 form.


That's correct -- remember you're having taxes withheld with each paycheck you receive, so at the end of the year ideally you owe nothing and receive nothing. The credit is based on your overall liability, not what you "still owe" when you file.


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## calvan (Jun 29, 2018)

SoFlaModel3 said:


> That's correct -- remember you're having taxes withheld with each paycheck you receive, so at the end of the year ideally you owe nothing and receive nothing. The credit is based on your overall liability, not what you "still owe" when you file.


Sorry I'm not following, so in order to use the full tax credit I do not have to change my withholding to have a tax burden when I file? I usually get a decent return and because it's a non-refundable credit I thought I had to owe $7500. I didn't think I could use it if I get a return. I'm waiting to talk to my tax guy as he has been out of country for most of the summer. Thanks for any clarification.


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## SoFlaModel3 (Apr 15, 2017)

calvan said:


> Sorry I'm not following, so in order to use the full tax credit I do not have to change my withholding to have a tax burden when I file? I usually get a decent return and because it's a non-refundable credit I thought I had to owe $7500. I didn't think I could use it if I get a return. I'm waiting to talk to my tax guy as he has been out of country for most of the summer. Thanks for any clarification.


The best way to put it simply - tax liability represents what you owe for the year.

You get a return each year because you're withholding too much on your paychecks and at the end of the year you have paid more that you should have, hence the refund.

Let's say your tax liability is $15,000 and you were going to get a $1,000 tax refund. This time around your tax refund would be $8,500.

Now change the example, let's say your tax liability is $5,000 and you owed $500 when doing your taxes. Since the credit caps at the tax liability if less than $7,500 you would get back $4,500.

I hope that helps!

A lot of people will adjust their withholdings during the year to basically start collecting on the credit early. I opted to not play the game just in case something crazy happens and the credit is retroactively wiped out.


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## calvan (Jun 29, 2018)

SoFlaModel3 said:


> The best way to put it simply - tax liability represents what you owe for the year.
> 
> You get a return each year because you're withholding too much on your paychecks and at the end of the year you have paid more that you should have, hence the refund.
> 
> ...


I agree with you I don't want to change my withholdings if I don't have to. No rush to get the $7500 as long as I know I am getting it.


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## sejinro (Aug 21, 2018)

If I place an order today for RWD, standard color, 19" Aero Wheels, and AP, and pay the $2,500 deposit today, will I be able to cancel my order if I don't get a 2018 delivery date? I am only willing to pull the trigger if I can get the Federal tax credit.


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## Jay79 (Aug 18, 2018)

sejinro said:


> If I place an order today for RWD, standard color, 19" Aero Wheels, and AP, and pay the $2,500 deposit today, will I be able to cancel my order if I don't get a 2018 delivery date? I am only willing to pull the trigger if I can get the Federal tax credit.


Just so you understand the tax credit goes against your Tax Liabilities, not your taxable income. So if you don't owe at least 7,500 in taxes it will be wasted. You can cancel and get a refund unless its in production or a VIN has been allocated. Call Tesla Support otherwise and they can point you in the right direction.


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## sejinro (Aug 21, 2018)

Yup, understood and thanks. I will have tax liabilities that exceed $7,500 in 2018.


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## iChris93 (Feb 3, 2017)

sejinro said:


> Yup, understood and thanks. I will have tax liabilities that exceed $7,500 in 2018.


You also know that half the credit is available for the first half of 2019?


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## sejinro (Aug 21, 2018)

Yes, thanks. I was hoping to get the larger amount, lol. How's it looking though given my desired config?


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## SoFlaModel3 (Apr 15, 2017)

If you order today and cancel you lose your $2,500 deposit. 

If you order today and the car slips to January+ for delivery you lose $3,750 in credit dollars. 

Best bet is to order ASAP with a 2-4 month delivery window.


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## jsmay311 (Oct 2, 2017)

M3P said:


> You can cancel and get a refund unless its in production or a VIN has been allocated.


I don't think this is correct.



SoFlaModel3 said:


> If you order today and cancel you lose your $2,500 deposit.


This is my understanding as well.


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## Toadmanor (Jul 23, 2018)

I was faced with the same dilemma. I really wanted the car delivered by 12/31/2018 to get the tax credit.

So, I ordered on 8/14/2018 figuring ample time to get within the ~2-4 months window. So, I am now getting delivery on 8/24/2018...10 days after placing order. The only problem is that I will have too many cars for my garage until May 2019 when a lease I have expires.

Guess which car most assuredly will have garage space?


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## Troy (Sep 18, 2017)

For Model 3 LR RWD, there is no risk that you might not get it this year. It's 99.5% likely that you will get it this year. It's 83% likely that the car will be delivered within a month if you order now.

However, for LR AWD, there is a huge queue and it is questionable whether somebody ordering today could get it by the end of the year unless they are a Tesla owner or they have a reservation. They are prioritizing owners and reservation holders.

Check out the VIN Queue tab here. Compare these two tables:

table starting in column W, Model 3 LR
table starting in column AH, Model 3 LR AWD, no reservation, no ownership priority


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## Toadmanor (Jul 23, 2018)

@Troy

Thanks that was the problem I was thinking it was the forum account log in that validated the id.


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## RoadToLevel5 (Aug 3, 2017)

Troy said:


> For Model 3 LR RWD, there is no risk that you might not get it this year. It's 99.5% likely that you will get it this year. It's 83% likely that the car will be delivered within a month if you order now.
> 
> However, for LR AWD, there is a huge queue and it is questionable whether somebody ordering today could get it by the end of the year unless they are a Tesla owner or they have a reservation. They are prioritizing owners and reservation holders.
> 
> ...


This spreadsheet has great information! I can't figure out if there's any data on "order to delivery" time. I see "VIN to delivery".

If most LR RWD deliveries are happening within a month while the online tool says ~2-4 months, I'm wondering how far off is the SR estimate of 5-8 months. Hopefully, it's much sooner, considering that the demand for LR may be plateauing.


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## Jay79 (Aug 18, 2018)

jsmay311 said:


> I don't think this is correct.
> 
> This is my understanding as well.


Well I just did it and my refund is coming back to me in 30 days, but what do know...lol

I re ordered with my buddies referral code, fyi


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## Troy (Sep 18, 2017)

RoadToLevel5 said:


> I'm wondering how far off is the SR estimate of 5-8 months.


Based on my calculation, there are about 56,000 VIN waiters. I'm calculating 4,000 LR + 40,500 LR AWD + 11,500 Performance = 56,000 orders pending production before Standard Range and EU orders. If there were no new LR, LR AWD and P orders, clearing out the current list would take until the end of November. However, we are still getting about 2,500 new LR AWD and P orders per week. Therefore SR in 2018 looks unlikely except maybe a symbolic number of units.

I think buyers in the US who are waiting for the SR could consider ordering an LR now. LR orders are still delivered quickly. That means you will get $7,500 instead of $3,750. Yes the LR costs $9,000 more which means you will still end up paying $9,000 - $3,750= $5,250 for the Long Range battery but that looks like a good deal to me because when it's time to sell the car, you will get that money back.

For LR AWD or P buyers, the time is running out for a 2018 delivery. It might already be too late unless the person ordering has a reservation or owner priority. I recommend comparing the tables in the VIN Queue tab here.


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## systemBuilder (Jul 1, 2018)

The wait for performance cars can be a long wait. With 11,500 orders, and only 20% of cars being made are performance (in the tent), i.e. 4000 cars per month, tops, so there is a 3-month backlog if you order a perf car today, assuming Tesla is serving people FIFO but it seems like they are sort of serving people in random order, at least with RWD orders. I haven't heard of any non-reservation people getting performance cars, but I'm sure it's coming.

I"ve been waiting almost 2 months, I reserved on 6/16/2016.


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## garsh (Apr 4, 2016)

systemBuilder said:


> ...assuming Tesla is serving people FIFO but it seems like they are sort of serving people in random order...


At this point, the order of deliveries depends mostly on which batch of colors/options they're making during a time period, and arranging the logistics of shipping cars to the various delivery centers.


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## RoadToLevel5 (Aug 3, 2017)

Troy said:


> I'm calculating 4,000 LR + 40,500 LR AWD + 11,500 Performance = 56,000 orders pending production before Standard Range and EU orders.





Troy said:


> However, we are still getting about 2,500 new LR AWD and P orders per week.


Great information and tracking!

How are you extrapolating to these numbers from your sample?


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## Long Ranger (Jun 1, 2018)

I'd like to suggest that this thread should be renamed from "Question: Federal Tax Credit and Ability to Opt Out" to "Question: Federal Tax Credit and Ability to Cancel Order". "Opt out" makes it sound like you are trying to opt out of receiving the tax credit somehow.


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## SoFlaModel3 (Apr 15, 2017)

Long Ranger said:


> I'd like to suggest that this thread should be renamed from "Question: Federal Tax Credit and Ability to Opt Out" to "Question: Federal Tax Credit and Ability to Cancel Order". "Opt out" makes it sound like you are trying to opt out of receiving the tax credit somehow.


Done!


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## Ed Woodrick (May 26, 2018)

iChris93 said:


> You also know that half the credit is available for the first half of 2019?


I believe that it is available ALL of next year. 50% in the first half, 25% in the second half.
Everybody is probably going to get a rebate, just a matter of how much.


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## systemBuilder (Jul 1, 2018)

Troy said:


> Based on my calculation, there are about 56,000 VIN waiters. I'm calculating 4,000 LR + 40,500 LR AWD + 11,500 Performance = 56,000 orders pending production before Standard Range and EU orders. If there were no new LR, LR AWD and P orders, clearing out the current list would take until the end of November. However, we are still getting about 2,500 new LR AWD and P orders per week. Therefore SR in 2018 looks unlikely except maybe a symbolic number of units.
> 
> I think buyers in the US who are waiting for the SR could consider ordering an LR now. LR orders are still delivered quickly. That means you will get $7,500 instead of $3,750. Yes the LR costs $9,000 more which means you will still end up paying $9,000 - $3,750= $5,250 for the Long Range battery but that looks like a good deal to me because when it's time to sell the car, you will get that money back.
> 
> For LR AWD or P buyers, the time is running out for a 2018 delivery. It might already be too late unless the person ordering has a reservation or owner priority. I recommend comparing the tables in the VIN Queue tab here.


There are a nontrivial number of LR RWD buyers who want to upgrade to PERF. Consider buying a used RWD car, you might save $3k, so $40k net price in the ideal case.


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## ChrisHa (Apr 12, 2018)

jsmay311 said:


> I don't think this is correct.
> 
> This is my understanding as well.


The contract says you can cancel if no VIN has been assigned.


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## BallzOne (Jul 18, 2018)

systemBuilder said:


> I haven't heard of any non-reservation people getting performance cars, but I'm sure it's coming.


I'm a non reservation non prior owner with a performance. Ordered 7/12/18 received 8/21/18.


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## Ole1 (Jul 7, 2018)

Just received email from tesla, with a new order agreement, dated today, that states that they have changed my order to a "Model 3 Not including the $7,500 Federal Tax Credit"

Pardon me, but what happened to the (legally binding contract ?) order agreement I entered into with Tesla on July 13 ? (I do of course have a copy)
(paid the extra 2500 and ordered our stealth P3 on June 28th)

What ??????


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## judomc (Jun 11, 2018)

Ole1 said:


> Just received email from tesla, with a new order agreement, dated today, that states that they have changed my order to a "Model 3 Not including the $7,500 Federal Tax Credit"
> 
> Pardon me, but what happened to the (legally binding contract ?) order agreement I entered into with Tesla on July 13 ? (I do of course have a copy)
> (paid the extra 2500 and ordered our stealth P3 on June 28th)
> ...


I believe they are just stating that the price shown doesn't include the tax credit, it's the base price.


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## GDN (Oct 30, 2017)

Can't speak to your email, but on the pricing pages for the S and X and I think after they opened the configurator for everyone on the 3, they'd always shown the total price, minus the $7500, trying to show you the total cost of ownership, not the drive out the door price of the car. They may be updating and changing that near the end of the year, because the $7500 is gone as of Jan 1.

On a side note, no matter what you did in July, I think you have to have the sale completed by EOD on December 31 for you to qualify for the credit. Just because you ordered, if they haven't fulfilled your order and you don't have a signed purchase agreement before Dec 31, you won't likely qualify for the whole $7500, only one of the lesser amounts based on when you do actually purchase and take delivery.

Have you taken delivery? Is there a chance you won't get delivery until after Dec 31?

As @judomc notes as well, they may just be clarifying you are buying the car for the full list price, and any rebates, etc take place after the fact and could vary depending on when you truly complete your purchase.


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## kort677 (Sep 17, 2018)

Ole1 said:


> Just received email from tesla, with a new order agreement, dated today, that states that they have changed my order to a "Model 3 Not including the $7,500 Federal Tax Credit"
> 
> Pardon me, but what happened to the (legally binding contract ?) order agreement I entered into with Tesla on July 13 ? (I do of course have a copy)
> (paid the extra 2500 and ordered our stealth P3 on June 28th)
> ...


I think that you've misunderstood how the price of the car was calculated. you are obliged to file for the tax credit


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## MascotRay (Feb 14, 2018)

Take a breath. It’s not what you think it means. Unless you changed your configuration in a manner that would push your delivery date into 2019, you’re good. My guess is they have had people asking why they have to pay full price when there’s a tax credit, and they are just getting ahead of it so people understand it’s something they have to file for after the fact.


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## Ed Woodrick (May 26, 2018)

Tesla does not provide the rebate, Tesla does not control the rebate.

Feel free to hire a lawyer to defend your legally binding contract, but since it doesn't exist, it would be a waste of money


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## GDN (Oct 30, 2017)

A further clarification others are noting, ordering and deposits have nothing to do with purchasing or taking delivery and the rebate.


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## jasonm163 (Sep 12, 2018)

Can someone please help me understand the tax credit? I believe i have it correct but want to verify with actual tesla owners.

If at the end of the year my total in taxes that I should have paid is (for easy numbers) $10,000 and I have actually paid a total of $12,000, I get my yearly refund of $2,000. 

Now I purchased a tesla and receive a $7500 tax credit. That means my total taxes I should have paid for the year = $2500 ($10,000-$7,500 credit). I still paid $12,000 in taxes but should have only paid $2,500 so I now get back $9500?

Is this correct? If not, can someone please help me understand. New to tax credits....


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## SoFlaModel3 (Apr 15, 2017)

You are spot on. Of course the scenario is simplified and doesn’t account for other rebates, etc but at its core you have it right. 

The only other thing to consider is that if your tax liability is less than $7,500 you will get the credit up to the amount of your liability and not more.


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## Ed Woodrick (May 26, 2018)

jasonm163 said:


> Can someone please help me understand the tax credit? I believe i have it correct but want to verify with actual tesla owners.
> 
> If at the end of the year my total in taxes that I should have paid is (for easy numbers) $10,000 and I have actually paid a total of $12,000, I get my yearly refund of $2,000.
> 
> ...


Correct, also remember that this is on the taxes owed, not your income, not how much taxes you paid, it is the taxes owed. If you own TurboTax, you can rerun last year's, just adding a tax credit to see what happens.

Also, if you have state tax, remember that the credit can be liable from a state tax perspective, so after fed and state, you may not get the full 7500.


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## garsh (Apr 4, 2016)

Ed Woodrick said:


> Correct, also remember that this is on the taxes owed


Saying "taxes owed" is too vague. It could mean your total tax liability (the taxes you owe for the entire year), or it could mean the amount you owe after all of your paycheck deductions. To be clear, your total tax liability must be at least $7500 to get the full credit.


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## FRC (Aug 4, 2018)

I am a CPA, and what Garsh says is correct. The credit has nothing to do with how much you've paid in towards the years total tax, but reduces the total tax itself. So if your total tax before the credit is $7500 or greater, you get full benefit of the credit in the form of a larger refund check or a smaller check to the IRS. Also, the federal credit has no affect on your state taxes and vice versa.


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## MelindaV (Apr 2, 2016)

Ed Woodrick said:


> If you own TurboTax, you can rerun last year's, just adding a tax credit to see what happens.


cautionary warning on this, is the tax code is significantly different for 2018 as it was for 2017.


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## babula (Aug 26, 2018)

For people doing their own taxes, is there anything in particular I have to fill out? Or is it automatic based on name and SS#?


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## garsh (Apr 4, 2016)

babula said:


> For people doing their own taxes, is there anything in particular I have to fill out? Or is it automatic based on name and SS#?


IRS Form 8936
https://www.irs.gov/pub/irs-pdf/i8936.pdf


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## PNWmisty (Aug 19, 2017)

The best way to insure you'll get the full $7500 credit is to make more money. More earnings = more tax liability. Since capital gains count towards total tax liability you can sell appreciated stock to increase your tax liability if necessary.


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## EBMCS03 (Jun 10, 2017)

You make enough to get $7500. Just make sure you take delivery before 12/31/2018. That’s it.


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## garsh (Apr 4, 2016)

EBMCS03 said:


> You make enough to get $7500. Just make sure you take delivery before 12/31/2018. That's it.


And if you don't "make enough", there are additional ways to increase your tax liability:

Sell some investments
Transfer an IRA or 401k into a Roth IRA or Roth 401k


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## MelindaV (Apr 2, 2016)

garsh said:


> Sell some investments


Add: 'for a gain' 
(maybe not the $tsla shares quite yet...)


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## EBMCS03 (Jun 10, 2017)

And now... order before Oct 15


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## ev_fellow (Dec 17, 2018)

I've read that leasing an EV will not allow you to claim the $7500 tax credit because the lessor is the titleholder. What happens in case of financed EVs? If I just financed a Model 3 through a Credit Union and took delivery before December 31st 2018, do I get to claim the $7500 credit? In case of financed EVs, my bank would be the lienholder and have the title to the car. Can I still claim the federal tax credit?


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## FRC (Aug 4, 2018)

Your name is on the title as owner, credit union as lienholder. Owner gets to use the credit. Lienholder does not affect the credit.


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## Toadmanor (Jul 23, 2018)

I agree with @FRC .


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## Jay Jay (Oct 26, 2018)

Yes, you absolutely can. It's not a lease (i.e a car owned by Tesla).


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## MSM3 (Aug 5, 2018)

You're confusing lease vs. loan. I don't think there is a lease option for the Model 3 yet. Your credit union holds title to your car and is the lienholder, but it is still a loan so you can apply for the credit.


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## Guest (Dec 22, 2018)

I agree, we both used Suncoast Credit Union in Florida for 2.5% for my Model 3 Performance back in September, and my Fiancee received 3% in December for her AWD LR Model 3. Our same accountant for both of us was involved in both purchases, with no red flags.


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## EValuatED (Apr 29, 2017)

Yes, this is my 4th Fed EV tax credit and the cars have been either financed or cash, and, you can claim the credit if financed.


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## John A Bailey (May 25, 2018)

yes...I did it with my model S and will be doing it with my model 3


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## simon20447 (May 6, 2019)

Looking at ordering a M3 SR+ and want to:

1. Take advantage of the current federal tax credit 
2. Leave it as late as possible as the lease runs out on my current vehicle at the end of August.

To qualify for the tax credit do I just need to order by 6/31 or take delivery?

Oh and have to convince the wife beforehand...working on that!

Thanks in advance!


Sent from my iPhone using Tapatalk


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## Gatornail (Apr 11, 2017)

The IRS goes by the date the vehicle is put in service, meaning the day you take delivery not the day you order.


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## simon20447 (May 6, 2019)

Thank you!


Sent from my iPhone using Tapatalk


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## Bokonon (Apr 13, 2017)

Welcome to the forum! 



simon20447 said:


> To qualify for the tax credit do I just need to order by 6/31 or take delivery?


You need to take delivery by June 30th. (I do not recommend taking delivery on June 31st for a variety of reasons.  ).

Be sure to give yourself plenty of time to take delivery. In particular, do not take Tesla's "two weeks" estimate at face value, because it could easily be four or more, depending on the availability of your configuration and delivery times to Florida. Squeezing every last penny out of your lease isn't worth potentially missing out on half of the $3750 federal credit.



simon20447 said:


> Oh and have to convince the wife beforehand... working on that!


Best of luck! Common approaches mentioned here include:

1. Educating her about the benefits of EV ownership, available incentives, etc., and taking her to a Tesla store for a test drive so she can experience it for herself.

2. Talking nonstop about Tesla 'round the clock until she throws her hands up in frustration and says, "Oh, just shut up and order one already!!"


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## Johnston (Oct 12, 2018)

Bokonon said:


> Welcome to the forum!
> 
> You need to take delivery by June 30th. (I do not recommend taking delivery on June 31st for a variety of reasons.  ).
> 
> ...


Also, don't forget to mention how the car keeps improving via OTA updates. Thus far no other mfg offers this feature.

Ideally run some numbers on your own and figure out know your cost of ownership. Weight monthly costs by the total costs, ie car payment + gas + insurance, against another car you would buy if you weren't buying the 3. Divide the $3750 by how many payments you'll be making and include that in your monthly cost comparisons as well.

For example, the car I would have gone for if I did not take the Tesla plunge would be a well-equipped Mazda 6. The amount of driving I'm doing, gas would cost me $200 per month, electricity $50 per month. Insurance rates I think maybe $50 to Mazda's advantage. Put that $100 extra toward the difference of monthly payments between the 2 cars. You'll have to estimate maintenance costs a bit, but do know that the 3's maintenance costs would be noticeably lower with no periodic oil changes and a bunch of other parts that need to be periodically looked at.


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## LoveM3 (Nov 21, 2018)

You need to take delivery by 6/31


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## FRC (Aug 4, 2018)

LoveM3 said:


> You need to take delivery by 6/31


I think it would be wise to take delivery "before 6/31"


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## Ed Woodrick (May 26, 2018)

If you want a tax credit, all you need to do is buy by end of year.
If you want current $3750 credit then you get before 7/1


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## MelindaV (Apr 2, 2016)

Ed Woodrick said:


> If you want a tax credit, all you need to do is buy by end of year.
> If you want current $3750 credit then you get before 6/1


Q2 goes thru June


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## Ed Woodrick (May 26, 2018)

MelindaV said:


> Q2 goes thru June


Isn't that what I said

(Thank the forum software for edit abilities)


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## simon20447 (May 6, 2019)

Thanks everyone!

Of course there isn't a 6/31!! Must be a leap year 

Appreciate the advice!

Sent from my iPhone using Tapatalk


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## 11thIndian (Jan 15, 2017)

It's that time of year! So I'm prepping documents for my accountant. I'm quite surprised there isn't a YouTube video going thru this process.

So I need to fill out form 8936. Does Tesla need to supply me with IRS documentation, or is it the Order Agreement or Loan Agreement I can download from my Tesla page? What cost are they looking for in Line 4a?

Also, beside your name, is the "Identifying Number" my SSN?


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## Long Ranger (Jun 1, 2018)

11thIndian said:


> It's that time of year! So I'm prepping documents for my accountant. I'm quite surprised there isn't a YouTube video going thru this process.
> 
> So I need to fill out form 8936. Does Tesla need to supply me with IRS documentation, or is it the Order Agreement or Loan Agreement I can download from my Tesla page? What cost are they looking for in Line 4a?
> 
> Also, beside your name, is the "Identifying Number" my SSN?


You don't need any special documentation from Tesla. Just download the order agreement.

Line 4a is $7500. Line 4b is 50% if you purchased Jan 1 to June 30, and 25% for July 1 to Dec 31. You can see this if you download the 8936 instructions.

Yes, Identifying number is your SSN (unless the IRS has issued you a special number).


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## DennisP (Jan 5, 2019)

For those waiting on the 8936 for TurboTax it's included in an update today. The 8911 for a charging station isn't out yet though, should be in a week or so....


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## shareef777 (Mar 10, 2019)

Anyone know what the qualifications for the charging station credit is? I installed a HPWC last year and have a tax liability much higher then what the credit will allow. TurboTax seems to indicate that I don't qualify for any credit, but their app has falsely calculated credits already (gave full $7500 credit for Teslas purchased in 2019).


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## BluestarE3 (Oct 12, 2017)

shareef777 said:


> Anyone know what the qualifications for the charging station credit is? I installed a HPWC last year and have a tax liability much higher then what the credit will allow. TurboTax seems to indicate that I don't qualify for any credit, but their app has falsely calculated credits already (gave full $7500 credit for Teslas purchased in 2019).


I believe today is their D-Day for having the corrected EV tax credit forms available. You may want to check for updates later today or tomorrow and see if the credits show up correctly afterwards.


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## Rj8731 (Dec 11, 2019)

It has been updated.


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## shareef777 (Mar 10, 2019)

Yeah, I have the corrected form. Turns out I don’t qualify for the HPWC credit as I don’t meet the AMT after my child credits and Tesla credits.


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## DennisP (Jan 5, 2019)

BluestarE3 said:


> I believe today is their D-Day for having the corrected EV tax credit forms available. You may want to check for updates later today or tomorrow and see if the credits show up correctly afterwards.


Yes, I checked first thing this morning and got the update - was able to do both forms. I say both because the EV credit calculation was corrected and I had to put it $7500 vice $3750 to get the actual $3750 credit.


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