Halfpoint Images | Moment | Getty ImagesThe federal government has issued more than $1 billion in tax credits as an upfront cash incentive to buyers of electric vehicles, the U.S. Treasury Department and Internal Revenue Service said Wednesday.The Inflation Reduction Act created a mechanism whereby tax credits for buyers of new and used EVs — worth up to $7,500 and $4,000, respectively — could be delivered by car dealers at the point of sale.The provision kicked in on Jan. 1.Previously, consumers had to wait until filing their annual tax return, perhaps months or more than a year after their vehicle purchase, to get the federal credit. Americans can now also get the EV tax credit upfront regardless of their federal tax liability, which wasn’t the case prior to 2024.”This has never been done before,” Deputy Treasury Secretary Wally Adeyemo said during a press call.More from Personal Finance:The tax deadline for American expats is June 17Biden and Trump both want to extend tax cuts for most AmericansHome equity is near a record high. Tapping it may be trickyHe called the $1 billion threshold a “major milestone” that was hit faster than expected.”A lot of people would like to see the savings right now instead of waiting to file their taxes next year,” Adeyemo said.Trying to help EVs compete on priceThe transition to EVs is a big component of the Biden administration’s push to reduce U.S. greenhouse gas emissions and curb global warming.The federal tax credit aims to make EVs more affordable for many households relative to their gasoline-powered counterparts.The EV tax credits make the cars “very price competitive and in some cases cheaper than the combustion engine vehicles” available on car lots, Adeyemo said.The average purchase price for electric cars was $55,242 in April 2024, versus $44,989 for traditional cars, according to Cox Automotive data. However, prices are quickly dropping: Average prices for new EVs declined by 9% in the first quarter of 2024 relative to the same period last year, it said.However, not all new EV models are currently available for a federal tax credit, as automakers aim to meet certain manufacturing standards in the Inflation Reduction Act. The law requires certain parts of the car be manufactured in North America to qualify for a full or partial EV credit.The U.S. Energy Department maintains an updated list of automakers and models that qualify fo …
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[mwai_chat context=”Let’s have a discussion about this article:nnHalfpoint Images | Moment | Getty ImagesThe federal government has issued more than $1 billion in tax credits as an upfront cash incentive to buyers of electric vehicles, the U.S. Treasury Department and Internal Revenue Service said Wednesday.The Inflation Reduction Act created a mechanism whereby tax credits for buyers of new and used EVs — worth up to $7,500 and $4,000, respectively — could be delivered by car dealers at the point of sale.The provision kicked in on Jan. 1.Previously, consumers had to wait until filing their annual tax return, perhaps months or more than a year after their vehicle purchase, to get the federal credit. Americans can now also get the EV tax credit upfront regardless of their federal tax liability, which wasn’t the case prior to 2024.”This has never been done before,” Deputy Treasury Secretary Wally Adeyemo said during a press call.More from Personal Finance:The tax deadline for American expats is June 17Biden and Trump both want to extend tax cuts for most AmericansHome equity is near a record high. Tapping it may be trickyHe called the $1 billion threshold a “major milestone” that was hit faster than expected.”A lot of people would like to see the savings right now instead of waiting to file their taxes next year,” Adeyemo said.Trying to help EVs compete on priceThe transition to EVs is a big component of the Biden administration’s push to reduce U.S. greenhouse gas emissions and curb global warming.The federal tax credit aims to make EVs more affordable for many households relative to their gasoline-powered counterparts.The EV tax credits make the cars “very price competitive and in some cases cheaper than the combustion engine vehicles” available on car lots, Adeyemo said.The average purchase price for electric cars was $55,242 in April 2024, versus $44,989 for traditional cars, according to Cox Automotive data. However, prices are quickly dropping: Average prices for new EVs declined by 9% in the first quarter of 2024 relative to the same period last year, it said.However, not all new EV models are currently available for a federal tax credit, as automakers aim to meet certain manufacturing standards in the Inflation Reduction Act. The law requires certain parts of the car be manufactured in North America to qualify for a full or partial EV credit.The U.S. Energy Department maintains an updated list of automakers and models that qualify fo …nnDiscussion:nn” ai_name=”RocketNews AI: ” start_sentence=”Can I tell you more about this article?” text_input_placeholder=”Type ‘Yes'”]
