[URGENT] $7500 credit for current reservation holders

[Paul]

The Act defines the placed in service date under the Transaction Rule as the day before the enactment of the Act, likely early next week. As I read this, it means that you would have to file for the rebate in your 2022 return which means you would have to have a VIN by April 2023. The issue is how far out from production Lucid can provide a VIN.

(l) TRANSITION RULE.—Solely for purposes of the ap-
24 plication of section 30D of the Internal Revenue Code of
25 1986, in the case of a taxpayer that—
1 (1) after December 31, 2021, and before the date
2 of enactment of this Act, purchased, or entered into
3 a written binding contract to purchase, a new quali-
4 fied plug-in electric drive motor vehicle (as defined in
5 section 30D(d)(1) of the Internal Revenue Code of
6 1986, as in effect on the day before the date of enact-
7 ment of this Act), and
8 (2) placed such vehicle in service on or after the
9 date of enactment of this Act,
10 such taxpayer may elect (at such time, and in such form
11 and manner, as the Secretary of the Treasury, or the Sec-
12 retary’s delegate, may prescribe) to treat such vehicle as
13 having been placed in service on the day before the date
14 of enactment of this Act.

 

[noobzilla]

The Act defines the placed in service date under the Transaction Rule as the day before the enactment of the Act, likely early next week. As I read this, it means that you would have to file for the rebate in your 2022 return which means you would have to have a VIN by April 2023. The issue is how far out from production Lucid can provide a VIN.

(l) TRANSITION RULE.—Solely for purposes of the ap-
24 plication of section 30D of the Internal Revenue Code of
25 1986, in the case of a taxpayer that—
1 (1) after December 31, 2021, and before the date
2 of enactment of this Act, purchased, or entered into
3 a written binding contract to purchase, a new quali-
4 fied plug-in electric drive motor vehicle (as defined in
5 section 30D(d)(1) of the Internal Revenue Code of
6 1986, as in effect on the day before the date of enact-
7 ment of this Act), and
8 (2) placed such vehicle in service on or after the
9 date of enactment of this Act,
10 such taxpayer may elect (at such time, and in such form
11 and manner, as the Secretary of the Treasury, or the Sec-
12 retary’s delegate, may prescribe) to treat such vehicle as
13 having been placed in service on the day before the date
14 of enactment of this Act.

Hmmm it says "may elect". Does that mean we have option to treat placed in service date before bill passed OR on actual placed in service date?

 

[Chizle]

Hmmm it says "may elect". Does that mean we have option to treat placed in service date before bill passed OR on actual placed in service date?

Best just wait to see what the "form and manner" turns out to be.

 

[LCIDdreams]

Here is the language from the bill:

21 (1) after December 31, 2021, and before the
22 date of enactment of this Act, purchased, or entered
23 into a written binding contract to purchase, a new
24 qualified plug-in electric drive motor vehicle (as de25 fined in section 30D(d)(1) of the Internal Revenue
1 Code of 1986, as in effect on the day before the date 2 of enactment of this Act), and 3 (2) placed such vehicle in service on or after the 4 date of enactment of this Act, 5 such taxpayer may elect (at such time, and in such form 6 and manner, as the Secretary of the Treasury, or the Sec7 retary’s delegate, may prescribe) to treat such vehicle as 8 having been placed in service on the day before the date 9 of enactment of this Act.

So it will be up to the Biden Administration to determine the rules.

I would think it’s the IRS that would determine what constitutes a “binding contract to purchase”, no?

 

[Chizle]

I would think it’s the IRS that would determine what constitutes a “binding contract to purchase”, no?

Likely there will be a yes/no checkbox on the new EV tax credit form. Followed by a "skip below and enter amount on line...."

 

[LCIDdreams]

Hmmm it says "may elect". Does that mean we have option to treat placed in service date before bill passed OR on actual placed in service date?

Yes. As long as the car is delivered in 2022 it makes no difference. If car is delivered in 2023 (assuming you have a confirmed order and assuming that satisfies whatever IRS determines the “binding contract to purchase” requirement means) you obviously want to go by the “before” rule, because the “actual” date would not qualify for any credit as the car is >$55k.

 

[noobzilla]

Yes. As long as the car is delivered in 2022 it makes no difference. If car is delivered in 2023 (assuming you have a confirmed order and assuming that satisfies whatever IRS determines the “binding contract to purchase” requirement means) you obviously want to go by the “before” rule, because the “actual” date would not qualify for any credit as the car is >$55k.

Ok I think this makes sense.

 

[lucidophilic]

Do I have an option to lease my Pure reservation instead of finance it? And can Lucid apply discount possible federal tax in 2023 delivery period because I confirmed my reservation before new rules?

 

[codys21]

My question is about delays. In case, if Lucid can deliver my Pure in 2024 Q1, am I still eligible old terms? I mean is the 7,500$ tax credit still valid because I signed the contract before Biden’s rule?

I'm pretty sure it does not matter when we get to the car. I asked the same thing a few posts up plus I did some more Googling and could not find anything that references we need to actually take delivery of the vehicle by a certain date.

 

[DaveyBoyGT]

The Act defines the placed in service date under the Transaction Rule as the day before the enactment of the Act, likely early next week. As I read this, it means that you would have to file for the rebate in your 2022 return which means you would have to have a VIN by April 2023. The issue is how far out from production Lucid can provide a VIN.

(l) TRANSITION RULE.—Solely for purposes of the ap-
24 plication of section 30D of the Internal Revenue Code of
25 1986, in the case of a taxpayer that—
1 (1) after December 31, 2021, and before the date
2 of enactment of this Act, purchased, or entered into
3 a written binding contract to purchase, a new quali-
4 fied plug-in electric drive motor vehicle (as defined in
5 section 30D(d)(1) of the Internal Revenue Code of
6 1986, as in effect on the day before the date of enact-
7 ment of this Act), and
8 (2) placed such vehicle in service on or after the
9 date of enactment of this Act,
10 such taxpayer may elect (at such time, and in such form
11 and manner, as the Secretary of the Treasury, or the Sec-
12 retary’s delegate, may prescribe) to treat such vehicle as
13 having been placed in service on the day before the date
14 of enactment of this Act.

Fully agree. One problem not discussed is what happens if you take the credit in 2022, but for some reason are unable to finalize the purchase? I would think that you would have to file an amended 2022 return in future years to RETURN the tax credit to the IRS.

 

[DaveyBoyGT]

Fully agree. One problem not discussed is what happens if you take the credit in 2022, but for some reason are unable to finalize the purchase? I would think that you would have to file an amended 2022 return in future years to RETURN the tax credit to the IRS.

Actually, the act does not have a limit on how late you have to wait to finalize the purchase and take physical possession of the car. With the supply chain issues it could be years before you actually take possession of the car. Or what if Lucid goes bankrupt and stops building your car before you take possession?

 

[lucidophilic]

We are talking about federal tax as expected. Does anybody know about is Lucid eligible any state tax credit or rebate? I checked some states ev programs but no chance for Lucid due to overprice.

 

[noobzilla]

We are talking about federal tax as expected. Does anybody know about is Lucid eligible any state tax credit or rebate? I checked some states ev programs but no chance for Lucid due to overprice.

Varies by state and some local counties may also have incentives.

 

[limtless]

Do I have an option to lease my Pure reservation instead of finance it? And can Lucid apply discount possible federal tax in 2023 delivery period because I confirmed my reservation before new rules?

You can lease it from what my SA said, but the tax credit does not work that way. If you lease you do not get a credit and Lucid isn't crediting you anything. It's the IRS that gives you an UP TO $7,500 credit if you qualify for the full amount based on your tax situation. The way they advertise it is misleading and wrong IMO.

 

[limtless]

Actually, the act does not have a limit on how late you have to wait to finalize the purchase and take physical possession of the car. With the supply chain issues it could be years before you actually take possession of the car. Or what if Lucid goes bankrupt and stops building your car before you take possession?

Then you paid $300 or $1k for nothing and Lucid thanks you for the support. I will not enter into an agreement with Lucid on hope, hope is not a strategy.

 

[MPawelek]

Then you paid $300 or $1k for nothing and Lucid thanks you for the support. I will not enter into an agreement with Lucid on hope, hope is not a strategy.

 

[noobzilla]

I wonder once delivered do you need to file an amended 2022 tax return or do you claim the tax credit in the year you receive the vehicle?

You claim based on year placed in service aka delivered and starts being driven

The Act defines the placed in service date under the Transaction Rule as the day before the enactment of the Act, likely early next week. As I read this, it means that you would have to file for the rebate in your 2022 return which means you would have to have a VIN by April 2023. The issue is how far out from production Lucid can provide a VIN.

(l) TRANSITION RULE.—Solely for purposes of the ap-
24 plication of section 30D of the Internal Revenue Code of
25 1986, in the case of a taxpayer that—
1 (1) after December 31, 2021, and before the date
2 of enactment of this Act, purchased, or entered into
3 a written binding contract to purchase, a new quali-
4 fied plug-in electric drive motor vehicle (as defined in
5 section 30D(d)(1) of the Internal Revenue Code of
6 1986, as in effect on the day before the date of enact-
7 ment of this Act), and
8 (2) placed such vehicle in service on or after the
9 date of enactment of this Act,
10 such taxpayer may elect (at such time, and in such form
11 and manner, as the Secretary of the Treasury, or the Sec-
12 retary’s delegate, may prescribe) to treat such vehicle as
13 having been placed in service on the day before the date
14 of enactment of this Act.

Correction. It's looking like placed in service will be treated as before the bill passes.

 

[Steveinarizona]

I would think it’s the IRS that would determine what constitutes a “binding contract to purchase”, no?

Sort of. The Treasury...anyway.

 

[EVCar]

I got an email from Nissan today asking me to convert the deposit, just as Lucid did.
Interesting that the deposit is fully refundable.
"As an ARIYA* reservationist, you may have seen recent news about the proposed Inflation Reduction Act (IRA) and have questions about how it may impact your eligibility for the currently available up to $7,500 federal EV tax credit. We are here to keep you informed and to try to help put you in the best position to claim any EV tax credit that may otherwise be available to you under current law.

Here’s what you should know
This bill has already been passed by the Senate, could be voted on in the House as early as today, and is very likely to be signed into law by the President as early as August 13th if not sooner. Once enacted, there will be new requirements that all electric vehicles must meet to qualify for any EV tax credit, which may impact your ability to take advantage of the credit.

Here’s what you can do now
The proposed IRA provides that taxpayers who have a “written, binding contract to purchase” a vehicle that qualifies for an EV tax credit under current law will be eligible for any credit available to them under existing law. In order to help put you in the best position for potential federal EV tax credit eligibility, if you are prepared to commit to the future purchase of an ARIYA,* Nissan is offering an Agreement to Purchase an ARIYA* vehicle in the future from an authorized Nissan dealer of your choosing. Please note this step is not necessary to maintain your reservation.

Nissan cannot guarantee the availability of any EV tax credit. You should consult with your own tax advisor concerning eligibility for any credit.

Because the IRA could be enacted at any time, we encourage you to act as soon as possible. Simply click below to review the Agreement to Purchase and accept it."
"** $500 reservation fee required to reserve a Nissan ARIYA. Reservations might exceed initial production levels; therefore, Nissan cannot guarantee delivery of a 2023 ARIYA by any specific date. The $500 reservation fee is fully refundable at any time to your original form of payment. At the time of purchase, you may apply the $500 reservation fee toward the purchase of your reserved ARIYA. Excludes taxes, title, license and options. ARIYA available for purchase expected Late Fall 2022."

 

[codys21]

I got an email from Nissan today asking me to convert the deposit, just as Lucid did.
Interesting that the deposit is fully refundable.
"As an ARIYA* reservationist, you may have seen recent news about the proposed Inflation Reduction Act (IRA) and have questions about how it may impact your eligibility for the currently available up to $7,500 federal EV tax credit. We are here to keep you informed and to try to help put you in the best position to claim any EV tax credit that may otherwise be available to you under current law.

Here’s what you should know
This bill has already been passed by the Senate, could be voted on in the House as early as today, and is very likely to be signed into law by the President as early as August 13th if not sooner. Once enacted, there will be new requirements that all electric vehicles must meet to qualify for any EV tax credit, which may impact your ability to take advantage of the credit.

Here’s what you can do now
The proposed IRA provides that taxpayers who have a “written, binding contract to purchase” a vehicle that qualifies for an EV tax credit under current law will be eligible for any credit available to them under existing law. In order to help put you in the best position for potential federal EV tax credit eligibility, if you are prepared to commit to the future purchase of an ARIYA,* Nissan is offering an Agreement to Purchase an ARIYA* vehicle in the future from an authorized Nissan dealer of your choosing. Please note this step is not necessary to maintain your reservation.

Nissan cannot guarantee the availability of any EV tax credit. You should consult with your own tax advisor concerning eligibility for any credit.

Because the IRA could be enacted at any time, we encourage you to act as soon as possible. Simply click below to review the Agreement to Purchase and accept it."
"** $500 reservation fee required to reserve a Nissan ARIYA. Reservations might exceed initial production levels; therefore, Nissan cannot guarantee delivery of a 2023 ARIYA by any specific date. The $500 reservation fee is fully refundable at any time to your original form of payment. At the time of purchase, you may apply the $500 reservation fee toward the purchase of your reserved ARIYA. Excludes taxes, title, license and options. ARIYA available for purchase expected Late Fall 2022."

I think you may be misreading the refundable deposit. It seems the Nissan refundable deposit is similar to the Lucid refundable deposit. I'm assuming once a reservation holder chooses to enter into an agreement to purchase, that $500 is no longer refundable, just like with Lucid.