While so much has already been written about new EV credits, we’ve been getting a lot of questions from used car stakeholders. This session exclusively covers the used EV tax credit, and the requirements on both vehicles and their buyers.
It maybe shouldn’t be a surprise that the 700-page Inflation Reduction Act is confusing at times. Some parts lack clarity and others rely on systems that don’t exist yet. But one thing that is clear: car dealerships play a critical role in the process.
January 2023 Update
Implementation details for the new and used EV tax credits are still being ironed out by the IRS and Treasury Department. However, the used EV tax credit is now live for qualified sales. Here is what we know now:
- A the time of a qualifying sale, the dealership should provide the purchaser with a letter with details about the sale, including vehicle, VIN, battery size, and maximum eligible credit (30% of purchase price or $4,000). This letter should include the name and EIN of the dealership, and the name and tax ID of the purchaser.
- This document must include the following declaration: “Under penalties of perjury, I declare that I have examined this report submitted to the IRS pursuant to Revenue Procedure 2022-42 by [insert name of Seller], and to the best of my knowledge and belief I certify that this report is true, correct, and complete.”
- A similar report will be due to the IRS on January 15, 2024 but the requirements or form have not yet been released.
- Details are available in this public document. Section 5.01 details seller reporting.
- While this page on the IRS website lists manufacturers and models that are eligible for the credit, manufacturers who have not yet submitted paperwork may still do so and additional models and manufacturers may become eligible.
3-Part Series on EV Tax Credits
We've designed a series, lead by two EV experts, to help car dealerships and everyone in the auto industry prepare for used car tax credits.
- Liz is a mathematician and atmospheric scientist by training and, at Recurrent, is heading up our regulatory affairs on tax credits.
- Scott is Recurrent’s co-founder and CEO, and you’ve likely heard from him at some point, whether at a conference, or podcast, or webinar, as he’s become a trusted guide on EV adoption in the US.
Here is a recording of the first briefing. If you would like a copy of the slides, you can download them here.
The next tax credit briefing was held on October 13th.
The next tax credit briefing was held on December 16th. You can sign up here for future briefings.