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Here‘s a scenario to put your mind at ease regarding if the 200k vehicle sales cap could issue could even come into play:
All the data that I read indicates that Nissan was somewhere around 15,000 shy of hitting the 200k ceiling for total Leaf sales when the new legislation took effect mid August. Since the Leaf now qualifies under the new tax credit guidelines, (built in the USA) all Leaf sales August 17 forward will no longer count against Nissans old cap. That said, most data also suggests that Nissan closed the Ariya reservation process down in the USA just shy of 10,000 reservations. So it would be impossible for current Ariya USA reservation holders that have signed agreements with Nissan prior to 8/16/22 to ever exceed the old cap guideline rule.
Even if it goes over, it doesn't phase out on the 200,001th car sold. the sales quarter marks the end of the $7500 IIRC.
 

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Discussion Starter · #24 ·
Isn't the 200k cap per model though? Doesn't seem like it would apply.
Actually the old cap rule applied to all qualifying plug in models built by a manufacturer. For example Toyota hit the 200k cap the first quarter of 2022. Those sales were for the most part a combination of the Prius and RAV 4 Prime plug in hybrid models.
 

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The other issue for the old tax credit is the 200,000 vehicle cap.
I went to an online Quicken "Ask The Tax Expert" forum and asked the same question as Nissan will likely reach the 200k end-22 or Q1-23. Here is the response:
Inflation Reduction Act of 2022 (IRA 2022) signed into law on 8/16/2022. Hence terms used here are “Pre-IRA 2022” and “Post-IRA 2022.”

For deliveries/title transfers occur during 2022, the "Pre-IRA 2022" rules apply. The only difference is 1/1/2022 - 8/15/2022, the vehicle does not need to assembled in North America; 8/16/2022 - 12/31/2022, the vehicle needs to be assembled in North America.

If your written agreement is dated before 8/16/22 and you paid a nonrefundable deposit/downpayment of 5% or more and delivery occurs after 8/16/2022 to end of 2022, the vehicle does not need to be assembled in North America. (Transition rule)

Please look at page 2 of below link, under the column of "Pre-IRA 2022" under the label of "Plug-in EV credit": the highlights are -
*Max amount could be $7,500 non-refundable credit;
*Phaseout after 200,000 plug-in EVs manufactured and sole

Clean Vehicle Tax Credits in the Inflation Reduction Act of 2022
https://crsreports.congress.gov/product/pdf/IN/IN11996

You mentioned that the manufacturer is close to reaching its limit for existing EV credit.
Here is the general rule for manufacturer/vehicle approaching 200,000 cap: Taxpayers may claim the full amount of the credit up to the end of the first quarter after the quarter in which the manufacturer records its sale of the 200,000th qualified vehicle. For the 2nd and 3rd quarters, taxpayers may claim 50% of the credit. For the 4th and 5th quarters, taxpayers may claim 25% of the credit. No credit is allowed after the 5th quarter. (Source - TheTaxBook research tool)

Please see below for Index for Manufacturers published by the IRS
IRC 30D New Qualified Plug-In Electric Drive Motor Vehicle Credit | Internal Revenue Service
 

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I went to an online Quicken "Ask The Tax Expert" forum and asked the same question as Nissan will likely reach the 200k end-22 or Q1-23. Here is the response:
Inflation Reduction Act of 2022 (IRA 2022) signed into law on 8/16/2022. Hence terms used here are “Pre-IRA 2022” and “Post-IRA 2022.”

For deliveries/title transfers occur during 2022, the "Pre-IRA 2022" rules apply. The only difference is 1/1/2022 - 8/15/2022, the vehicle does not need to assembled in North America; 8/16/2022 - 12/31/2022, the vehicle needs to be assembled in North America.

If your written agreement is dated before 8/16/22 and you paid a nonrefundable deposit/downpayment of 5% or more and delivery occurs after 8/16/2022 to end of 2022, the vehicle does not need to be assembled in North America. (Transition rule)

Please look at page 2 of below link, under the column of "Pre-IRA 2022" under the label of "Plug-in EV credit": the highlights are -
*Max amount could be $7,500 non-refundable credit;
*Phaseout after 200,000 plug-in EVs manufactured and sole

Clean Vehicle Tax Credits in the Inflation Reduction Act of 2022
https://crsreports.congress.gov/product/pdf/IN/IN11996

You mentioned that the manufacturer is close to reaching its limit for existing EV credit.
Here is the general rule for manufacturer/vehicle approaching 200,000 cap: Taxpayers may claim the full amount of the credit up to the end of the first quarter after the quarter in which the manufacturer records its sale of the 200,000th qualified vehicle. For the 2nd and 3rd quarters, taxpayers may claim 50% of the credit. For the 4th and 5th quarters, taxpayers may claim 25% of the credit. No credit is allowed after the 5th quarter. (Source - TheTaxBook research tool)

Please see below for Index for Manufacturers published by the IRS
IRC 30D New Qualified Plug-In Electric Drive Motor Vehicle Credit | Internal Revenue Service
Thanks for posting the link to the CRS document — that is the most concise description of the EV tax credit changes that I’ve seen. Based on the IRS statement that a binding contract includes 5%+ down payment, I’d say no one is getting a credit for an Ariya (unless of course they did put down several thousand $ downpayment).
 

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Thanks for posting the link to the CRS document — that is the most concise description of the EV tax credit changes that I’ve seen. Based on the IRS statement that a binding contract includes 5%+ down payment, I’d say no one is getting a credit for an Ariya (unless of course they did put down several thousand $ downpayment).
This likely depends on the local/state laws.
 

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Discussion Starter · #29 ·
Thanks for posting the link to the CRS document — that is the most concise description of the EV tax credit changes that I’ve seen. Based on the IRS statement that a binding contract includes 5%+ down payment, I’d say no one is getting a credit for an Ariya (unless of course they did put down several thousand $ downpayment).
I continue to hold out hope that the IRS must step in and make a final ruling and contend that the Nissan commitment agreement we all signed prior to 8-16-22 will be sufficient to satisfy the transition rule. The IRA legislation passed last August was so fast tracked that it caught many EV automakers and potential EV consumers off guard. To that end each EV mfg. potentially impacted by this legislation that already had a reservation process in place took a little different approach to generate a so called “binding agreement“. Needless to say no one mfg. impacted by this legislation ever came close to asking for a 5% or greater down payment in conjunction with their binding agreement verbiage to qualify. For example Fisker asked their reservation holders to agree that their entire $250.00 deposit would be non refundable if they decided to sign on the bottom line. Conversely Rivian asked their reservation holders to potentially only forfeit $100.00 of their $1000.00 deposit if they agreed to sign their binding agreement.
So again I maintain it will ultimately be up to the IRS discretion to make what I hope will be a reasonable and final ruling on this matter. In hindsight it’s clear that the many details pertaining to the “transition rule“ segment of the IRA legislation were never thoroughly considered.
 

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It is surprising to me, that so many folks here worry about the tax credit and whether is is valid if an agreement was signed before the new climate bill was signed. Unpaid student loans after folks signed contracts, are being waived and just imagine the backlash IRS will get if they come after genuine EV purchasers with a deposit or any kind of agreement to buy. Imagine if you are the IRS commissioner. Will you be going down that route? Never will happen in USA. Just file and get your $7500 and move on. It is the right thing in spirit and in deed and no one will come after you. At least that's my 2c. If I get my Aria I will buy and get my tax credit. If IRS wants money back, so it shall be but not before media will make a stink out if it.
 

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The other issue for the old tax credit is the 200,000 vehicle cap.
Should be irrelevant. The "binding contact" provision effectively freezes everything in time on 8/15/22. For tax credit purposes, you would be claiming that the car was purchased on 8/15/22.

If I get my Aria I will buy and get my tax credit. If IRS wants money back, so it shall be but not before media will make a stink out if it.
I don't know where you live that you think the general public would be sympathetic to someone who fudged their tax return to get a discount on a high-end SUV, but I can't imagine wanting to advertise that fact in my own home town.
 

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Should be irrelevant. The "binding contact" provision effectively freezes everything in time on 8/15/22. For tax credit purposes, you would be claiming that the car was purchased on 8/15/22.


I don't know where you live that you think the general public would be sympathetic to someone who fudged their tax return to get a discount on a high-end SUV, but I can't imagine wanting to advertise that fact in my own home town.
No need to fudge any tax return. We have a signed agreement with Nissan and made a purchase reservation almost 6 months before the bill, when the old system was in place. I will take the credit and let IRS deny it and justify it. if IRS and fed want to go after genuine intent tax payers so be it, while ignoring true fraud around PPP, COVID fund abuse, student loan abuse.
 

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No need to fudge any tax return. We have a signed agreement with Nissan and made a purchase reservation almost 6 months before the bill, when the old system was in place. I will take the credit and let IRS deny it and justify it. if IRS and fed want to go after genuine intent tax payers so be it, while ignoring true fraud around PPP, COVID fund abuse, student loan abuse.
A signed agreement with Nissan is useless. Direct sales is banned in some states and nonrefundable deposits are also banned in other states. A signed agreement with your dealer with some binding language or significant nonrefundable deposit is the only way I can see it surviving IRS scrutiny.

FYI IRS will deny your claim and it will be up to you to justify it (not them). Valid EV tax credits have been questioned already (I may have already discussed this in this forum) with Bolt 2019 owners who claimed valid tax credits during the phase out period. IRS doesn't even know their own rules sometimes and the onus is on the taxpayer to proof eligibility.
 
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