Since the introduction of the Inflation Reduction Act of 2022, there has been quite a bit of confusion in regards to what vehicles are eligible for the revised tax credit, though things eventually became a bit clearer earlier this year, revealing that a number of Blue Oval models qualify, including the Ford F-150 Lightning, Ford Mustang Mach-E, Ford E-Transit, Lincoln Aviator Grand Touring, Ford Escape PHEV, and Lincoln Corsair Grand Touring – though Ford keeps that incentive when customers opt to lease rather than buy. Now, the U.S. Department of the Treasury and the Internal Revenue Service (IRS) have revealed that both Ford dealers and customers will receive those credits rather quickly, too.
Starting January 1st, 2024, consumers can choose to transfer their new clean vehicle credit of up to $7,500 and their previously owned clean vehicle credit of up to $4,000 to a Ford dealer (or any other eligible brand), which essentially means that they can take advantage of that incentive at the point of sale, effectively lowering the cost of that vehicle on the spot, rather than having to wait and claim the credit on their next tax return.
As for Ford dealers, those entities will be able to register at the IRS Energy Credits Online website – a requirement if they want to offer consumers clean energy tax credits for qualifying electrified products – after which they’ll be able to submit clean vehicle sales information to the IRS and promptly receive payment for transferred credits, then they’ll be reimbursed for the credit within 72 hours.
It is worth noting that consumers will need to directly repay the full value of a transferred tax credit to the IRS when filing their taxes if they exceed the applicable modified adjusted gross income limitation, and that advance payments received by the dealer would not be treated as a tax credit and may exceed the dealer’s regular tax liability, however.
We’ll have more on the new clean vehicle tax credit soon, so be sure and subscribe to Ford Authority for 24/7 Ford news coverage.
Comments
I wonder if someone who does not earn enough, mainly me, to fully utilize the $7,500 credit, would be required to repay the difference – in other words, is the $7,500 fed credit ‘Non-Refundable’?
Be nice if there were more detail in these articles, no matter what the subject.
I’m sure when you file your taxes you will be responsible for the difference.