The Internal Revenue Service (IRS) has different tax credits, tax rebates, and tax deductions. Taking advantage of them is essential to get some free money. In this way, you can make the most of your finances.
The Clean Vehicle Credits are part of the Inflation Reduction Act of 2022. Sometimes legislation is just for businesses or individuals. However, the IRS claims that this tax credit worth up to $7,500 is for both businesses and individuals.
Do not forget that not all vehicles are eligible for this tax credit. It must meet critical mineral battery component features. If it does not meet these requirements, you will not be eligible. This new clean vehicle could have been bought on April 18, 2023, or after says the IRS.
WHICH VEHICLES COULD MAKE YOU ELIGIBLE FOR THIS IRS TAX CREDIT?
The Internal Revenue Service confirmed that it could be a fuel cell vehicle (FCV) or a new plug-in electric vehicle. So, if you bought one after April 18, 2023, you may qualify for this tax credit.
Do not forget that it is the seller the one that must provide you with the information about your vehicle. In fact, they must register online and report the same information as you do to the IRS.
Not doing so may imply not receiving the tax credit. So, it is of vital importance that you make sure that everything is done as the IRS requests. Qualifying for a tax credit of up to $7,500 could be awesome.
Thanks to the Inflation Reduction Act of 2022, the rules for this tax credit changed for qualifying vehicles bought from 2023 to the year 2032. Let’s see the requirements to qualify for businesses and individuals.
WHO QUALIFIES FOR THE NEW CLEAN VEHICLES CREDIT?
First of all, look for a qualified plug-in EV or fuel-cell electric vehicle. Whether you are an individual or a business, you may be eligible. If you buy this vehicle for your own use, you may qualify.
However, if you buy it for resale, you will not qualify for this IRS tax credit. What is more, you must use it mostly in the United States. Apart from these requirements, there are also income limits.
Check your Adjusted Gross Income or AGI is not over $300,000 if you are a married couple filing together. The IRS has set a different amount for heads of households. So, your AGI cannot exceed $225,000.
Single filers’s AGI may not go over $150,000. The IRS allows you to use the AGI from the year you take the delivery of this EV or even the year before. Choose the lowest one. Note that this is a nonrefundable credit. Any excess credit cannot be used for upcoming years.
