Yes, starting January 1, 2024, you can transfer your electric vehicle (EV) tax credit to a registered dealer. This allows you to effectively lower the purchase price of a new or pre-owned EV by applying the clean vehicle tax credit directly at the time of sale instead of waiting to claim it on your tax return the following year. The dealer then receives the tax credit from the government as an advance payment, and you receive an immediate financial benefit through a price reduction on the vehicle.
Key points about transferring the EV tax credit to a dealer:
- The credit can be transferred only for vehicles used predominantly for personal use.
- You must provide certain information to the dealer to complete the transfer and attest that you qualify for the credit.
- If your modified adjusted gross income (MAGI) exceeds the eligibility limit for the year, you may have to repay the amount transferred as an additional tax.
- The credit transferred to the dealer is not limited to your tax liability, meaning you can benefit even if you have little or no federal tax owed.
- Dealers claim these credits through an IRS advance payment program and cannot directly claim the credit outside of that system.
In summary, the transfer option is designed to provide an immediate cost reduction when buying an EV, rather than the traditional method of claiming the credit when filing your tax return. Be sure to discuss this option with your dealer to take advantage of the benefit.
Original article by NenPower, If reposted, please credit the source: https://nenpower.com/blog/can-i-transfer-my-ev-tax-credit-to-a-dealer/
