Tax credits

[704.Lucid]

I’m surprised there’s no discussion about the loss of tax credits for most Lucid models in 2023. Makes the promise of a 2022 delivery much more valuable.

Anyone reconsidering their purchase? Am I missing something?

 

[EricM]

There’s another lengthy thread on tax credits where this is covered. Short answer is “no” as long as you have actually ordered (“confirmed”) your car before the bill is signed into law, you’re grandfathered under the old tax credit scheme.

 

[704.Lucid]

Nah. A reservation isn’t the same as a sales receipt. ‘Confirmed order’ doesn’t fly.

 

[EricM]

Nah. A reservation isn’t the same as a sales receipt.

Once you confirm your order it’s no longer a reservation and you have a documented “order agreement” that has all of the same contract language as a buyers order from a regular car dealer. It’s a five page document.

 

[704.Lucid]

OK, using your reply, the question is, ‘your confirmation is $7.5K more valuable this year than 2023. Would you reconsider your purchase?

p.s. I’m still not accepting your premise that confirmation is the same as delivery to the IRS

 

[EricM]

OK, using your reply, the question is, ‘your confirmation is $7.5K more valuable this year than 2023. Would you reconsider your purchase?

p.s. I’m still not accepting your premise that confirmation is the same as delivery to the IRS

Not at all.

 

[joec]

OK, using your reply, the question is, ‘your confirmation is $7.5K more valuable this year than 2023. Would you reconsider your purchase?

p.s. I’m still not accepting your premise that confirmation is the same as delivery to the IRS

There are at least two lengthy threads where folks went back and forth over this, and the bottom line is that we don’t know what the bill will look like in its final form (a few Senators are still flexing their muscles about wanting changes) so it’s not possible to know how it effects Lucid buyers just yet.

On the very good question as to whether losing the $7,500 credit would change one’s mind about ordering (assuming everyone who doesn’t have a delivered car loses it, for the sake of argument) for me, I’d be disappointed, but it won’t stop me from buying. I’m sure others here will feel differently.

It’s not like there’s any other EV I would want that WOULD qualify for the credit under these new terms. So I’m going to lose the credit regardless. And any ICE car is a nonstarter for me.

I’m curious if my state of Colorado will offer any additional incentives, given the federal loss. We’ve got a lot of climate initiatives here.

 

[704.Lucid]

Apologies to user EricM. I found this;

1. Transition provision for EVs with written sales orders dated in 2022 prior to the date of President signing the bill but delivered in 2023 allows purchaser to claim the “old” credit in 2023. (Page 386, line 20).

You were right. I’m better now.

 

[Bel]

Apologies to user EricM. I found this;

1. Transition provision for EVs with written sales orders dated in 2022 prior to the date of President signing the bill but delivered in 2023 allows purchaser to claim the “old” credit in 2023. (Page 386, line 20).

You were right. I’m better now.

Does it mean that the transaction of the full price has to occure and be dated in 22 or can it be in 23?

 

[H.S.]

That’s the $ 7,500 question. I hope I’m wrong, but I don’t think a reservation qualifies as a sale order.

 

[Bel]

Apologies to user EricM. I found this;

1. Transition provision for EVs with written sales orders dated in 2022 prior to the date of President signing the bill but delivered in 2023 allows purchaser to claim the “old” credit in 2023. (Page 386, line 20).

You were right. I’m better now.

I think for anyone buying a $140,000 car plus some accessories, ~$2000 insurance, installing charger/receptacle in garage, etc., $7500 isnt as important. As for myself, Ive put aside a $160000 part in my savings account since beginning of the year to be ready whenever the car comes.

 

[704.Lucid]

Once again, thanks to @EricM for making me research… Read item #3.

New Vehicle Credit

1. Manufacturer caps eliminated. (Page 370, line 15)
2. Credit applies for vehicles purchased beginning January 1, 2023. (Page 386, line 1).
3. Transition provision for EVs with written sales orders dated in 2022 prior to the date of President signing the bill but delivered in 2023 allows purchaser to claim the “old” credit in 2023. (Page 386, line 20).
4. Vehicle must be assembled in North America to qualify for new credit. (Page 366, line 15).
5. North American assembly requirement applies to vehicles sold after the date of adoption of the bill. (Page 386, line 3)
6. $7,500 credit is broke into two binary pieces meaning the vehicle either qualifies for each piece of the credit or it doesn’t. No longer based on size of battery. (Page 366, line 6)
7. $3,750 of the new credit is based upon the vehicle having at least 40% of its battery critical minerals from the United States or countries with a free trade agreement with the United States. This is a list of countries with free trade agreements with the US.(Page 371)
8. The other $3,750 of the new credit is based on at least 50% of the battery components of the vehicle coming from the United States or countries with a free trade agreement with the US. (Page 372, line 13)
9. The 40% minerals requirement increases to 50% in 2024, 60% in 2025, 70% in 2026 and 80% in 2027. (page 371 line 23)
10. The 50% battery components requirement increases to 60% in 2024, 70% in 2026, 80% in 2027, 90% in 2028 and 100% in 2029. (Page line 373)
11. The government has until the end of the year to develop guidance on the battery requirements. (Page 374)
12. Beginning in 2025, any vehicle with battery minerals or components from a foreign entity of concern are excluded from the tax credit. (Page 374, line 20).
13. One credit per vehicle. (Page 375, line 12)
14. Modified gross income limit of $150k for individuals, $225k for head of household, and $300k for joint returns. Definition of MAGI(page 375, line 22)
15. MSRP of vehicle must be $80k or less for SUVs, Vans and Trucks. $55k for all other vehicles. (Page 377, line 4)
16. Dealer can apply credit at time of sale. Dealer must disclose to buyer the MSRP of the vehicle, the applicable tax credit amount and the amount of any other available incentive applicable to the purchase. (Page 378, line 6)
17. Credit terminates December 31, 2032.

 

[H.S.]

For everyone with a reservation but no actual sales order yet, we’re all just guessing. Be nice to have some statement/guidance from Lucid. I think it’s naive to assume the loss of this credit won’t affect sales, especially following the recent price increase.

 

[H.S.]

I actually like most of the stuff in this new bill, just prefer not to see my personal little ox get gored.

 

[Maverick]

I think for anyone buying a $140,000 car plus some accessories, ~$2000 insurance, installing charger/receptacle in garage, etc., $7500 isnt as important. As for myself, Ive put aside a $160000 part in my savings account since beginning of the year to be ready whenever the car comes.

For AGT purchasers, sure. But there are a lot of Touring and Pure folks on this board who likely do find this amount important. For the Pure, it almost 10% off the car. Makes a big difference there I think.

 

[joec]

For AGT purchasers, sure. But there are a lot of Touring and Pure folks on this board who likely do find this amount important. For the Pure, it almost 10% off the car. Makes a big difference there I think.

And Touring and Pure purchasers are the least likely to have a confirmed order agreement before the President signs the bill.