Is one of your New Year’s resolutions trading in your current automobile for a new environmentally friendly vehicle? One of the more popular “green” vehicles available for purchase has been a Tesla. The purchase of a qualifying Tesla made prior to 2019 qualified a taxpayer to claim a plug-in electric motor vehicles tax credit in the amount of $7,500.
However, once a manufacturer sells 200,000 vehicles that qualify for the tax credit, the credit begins to phase out. Tesla reached that cap in late 2018. Tesla vehicles qualifying for the tax credit are the models S, X, and 3. As a result, in 2019 the plug-in tax credit for Tesla purchases will be limited as follows:
- A qualifying Tesla purchase (including delivery) made between January 1, 2019 – June 30, 2019 will qualify for a plug-in electric motor vehicle tax credit in the amount of $3,750.
- A qualifying Tesla purchase (including delivery) made between July 1, 2019 – December 31, 2019 will qualify for a plug-in electric motor vehicle tax credit in the amount of $1,875.
- A qualifying Tesla purchase (including delivery) made after December 31, 2019 will no longer qualify for the plug-in electric motor vehicle tax credit.
More interested in the tax credit than a Tesla? Check out the information provided by the IRS at: https://www.irs.gov/businesses/irc-30d-new-qualified-plug-in-electric-drive-motor-vehicle-credit.