Did you purchase an electric vehicle in 2023? Here is the information you need to qualify for the Clean Vehicle credit:
The seller of the vehicle must provide the buyer with a report at the time of sale. This report will verify that the vehicle and its battery are both credit eligible.
Buyers can confirm the clean vehicle they are purchasing is eligible for the credit through receipt of a valid time-of-sale report and confirmation that Energy Credits Online has accepted the submission for their clean vehicle purchase. Buyers must still meet certain income and other requirements.
The IRS will process the tax return and integrate with Energy Credits Online to substantiate and validate claims.
Source: https://tax.thomsonreuters.com/blog/understanding-clean-vehicle-credits-for-electric-vehicles/
Tax Tip: You must include the seller’s report with your tax documents. IRS guidance reads that the buyer won’t be eligible for the credit if the seller’s report is not included with delivery of the vehicle.
Beginning Jan. 1, 2024, the IRS will permit buyers who purchase new or qualifying used electric vehicles to transfer their EV tax credit directly to the dealer. This will result in the buyer’s purchase price being reduced by the amount of their credit. There are some rules surrounding this, such as the dealer/seller getting registered by Dec. 1, 2023, but this seems to be a step in the right direction and should simplify things for buyers.
If you have additional questions about an EV tax credit, please reach out to your accountant. We want to help make your life #LessTaxing!