There are no direct “penalties” for purchasing an EV that doesn’t meet the North American final assembly requirement, but the tax credit is simply unavailable for such vehicles. Key implications:
1. Ineligibility for Tax Credit
If the vehicle was purchased between August 17, 2022, and December 31, 2022, and lacks North American final assembly, it cannot qualify for the federal Clean Vehicle Credit. For 2023 and later purchases, additional battery component and critical mineral requirements apply on top of the assembly rule.
2. Purchase Consequences
Buyers of non-compliant vehicles:
- Lose up to $7,500 in potential tax credit savings
- No retroactive eligibility even if requirements change later
- No fines or legal penalties from the government, only lost financial incentives
3. Verification Requirement
Buyers must confirm assembly location through the Department of Energyās VIN Decoder tool or approved vehicle lists. Failure to verify risks claiming an invalid credit, which could lead to IRS repayment demands and penalties for incorrect tax filings.
Original article by NenPower, If reposted, please credit the source: https://nenpower.com/blog/what-are-the-penalties-for-purchasing-an-ev-that-doesnt-meet-the-north-american-assembly-requirement/
