Tax Credit Changes in new bill [LOCKED DUE TO POLITICS & ARGUING]

[astonius]

Is this guy for real? No I'm arguing sometimes what looks like needless spending drives innovation.
Tesla took full advantage of that tax credit to get them off the ground.

Electrify America wouldn't exist if the feds didn't force VW to do it.

I will no longer reply to these troll posts.

Sounds like you're quite generous with other people's money.

If you can't convince enough people to voluntarily part with their money and you need the government to coerce the investment then maybe you should do a better job persuading, or maybe it isn't a great idea.

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[electruck]

"Investment" is a nice way of putting it. Politicians want two things: your money and your vote. As long as they can convince you the only way to achieve your desired outcome is through them they'll continue to get both.

Politicians will be politicians but we would be living in a very different country were it not for Eisenhower's investment in the interstate highway system.

 

[Kenmecca]

Looks like Ill have to divorce my wife and have her buy my Rivian

 

[Acoustic71]

I would hope the majority of people considering an $80k vehicle are making over $300k joint a year. If not they may want to reconsider their priorities.

Speaking as a CPA, income is a terrible measure for incentives but an asset test is way too hard to implement so it’s the only “easy” way to do this. We have clients with tens of millions or hundreds of millions of assets whose income fluctuates year to year and there are years where they may have losses due to capital/equipment investments and bonus depreciation.

Former FA here, so thank you for bringing this up. Two of my worst clients worked in the local silicon industry and grossed over $500K annually. They had a huge house where they never really spent much time as they loved to travel every weekend. The house had a gorgeous and spotless kitchen. Gorgeous by design - spotless as they never cooked. They ate every single meal in a restaurant of some type. Both had two cars, etc. etc. etc.. They had the worst cash flow of any clients I ever had and I was tremendously relieved when they stopped being clients.

 

[astonius]

Looks like Ill have to divorce my wife and have her buy my Rivian

I was actually thinking, we can file separately right? That might make it feasible.

 

[Acoustic71]

Looks like Ill have to divorce my wife and have her buy my Rivian

You can get married again once some times passes. Hollywood types do it all the time for tax purposes.

 

[electruck]

Are you really arguing that EVs and clean energy have no private sector incentive? What's the most valuable auto company in the world right now?

Tesla's valuation isn't because they're so profitable selling EVs. Their valuation is based on the lie, sorry promise, of full self driving. Even Musk himself has stated the company is worthless if they can't solve FSD.

 

[Acoustic71]

The problem is how that money will be used...

And everyone has at least one opinion about that which explains why toilet paper is still in such short supply

 

[McMoo]

I was actually thinking, we can file separately right? That might make it feasible.

It could help depending on the income split between spouses and other factors.

 

[SASSquatch]

I live in SoCal and I get it. $300k *could* be practically paycheck to paycheck without making any extravagant lifestyle choices. At the same time, there is no shortage of luxury cars with no incentives, or people optioning up lower priced cars, wherever I’m out on the road.

I may be wrong, but I believe that if we lived in some alternate reality where we got to this point of EV adoption without incentives, and Rivian/Lucid/Porsche were all coming to market with their EVs without anyone expecting a tax credit, demand would be virtually the same and we’d still be dealing with demand outstripping supply.

Like someone else posted elsewhere, I’d rather see the incentives going to higher earners going to improvements in the charging infrastructure.

In my case, it may prevent me from purchasing the R1T and I think it may likely impact a lot of other reservation holders as well because it is hard to justify the cost of the vehicle because many of us were factoring in the EV credit in our buying decision.

The income cap is completely unnecessary and counterproductive. All it does is disincentivize the consumer from purchasing an electric vehicle because the point of the credit is to offset the higher cost of an EV relative to an ICE vehicle irrespective of your financial situation.

The intent should be to put more electric vehicles on the road and replace or offset ICE vehicles. EVs, because of supply constraints have significantly increased in cost relative to ICE vehicles (look at the price increases for Tesla and RIVIAN as examples). When the phase-out of the original credit was put in place the idea was that once a manufacturer has scale, they should be able to make the EV affordable but that hasn't happened.

The tax credit was a counterweight to EV specific price increases.

 

[McMoo]

Tesla's valuation isn't because they're so profitable selling EVs. Their valuation is based on the lie, sorry promise, of full self driving. Even Musk himself has stated the company is worthless if they can't solve FSD.

That’s quite an exaggeration. Their operating cash flows are nowhere near a company like Apple but I believe are still in the $2-3 billion range per quarter.

And FSD beta is the most impressive piece of innovation that could impact many peoples lives in a positive way if they can get it to work. I sure hope they do.

 

[mabowden]

The income limit is absolutely stupid and I disagree that it wouldn't change your purchase decision because your income is a function of your cost of living.

If I am making over $300K jointly in podunk pick your city/state USA with low cost of living then I'm golden and missing out on $7500 is likely not a deal breaker.

If I am making over $300K jointly in a major metropolitan area with HIGH cost of living like WMA, NY, CA, that $7,500 makes all the difference in the world. That is why the original $500K limit made more sense - for those of us who are in high cost of living states ESPECIALLY with the insane amount of inflation that is going on.

This is likely a Joe Manchin compromise because his understanding and appreciation for income levels is rooted in his constituents in WV who are likely making close to the US average income of ~65K.

Lots of people don't understand this. $7500 can be a lot for 300k joint earners in MANY parts of the US. It is for me in Socal. Not saying it will stop me from buying the truck, but it's part of the reason I put down my deposit, for sure. Luckily I think I'll slide in right under and still be okay. Maybe I'll see the truck in 2022 but that is fairly wishful thinking.

 

[freshpow]

Anyone else with an R1S on order considering a switch to an R1T if this passes? I prefer the look of the R1S and the functionality of the additional covered storage (so does my wife), but we don't have a real need for it or the 3rd row. I've seen many R1Ts delivered here in CO to preorder dates after mine (9/21) so figure I might be able to get it before end of year if I switch. I do fear the inevitable problems that come with the powered tonneau cover but having a tough time justifying an extra $10k+ for the R1S.

 

[SASSquatch]

Lots of people don't understand this. $7500 can be a lot for 300k joint earners in MANY parts of the US. It is for me in Socal. Not saying it will stop me from buying the truck, but it's part of the reason I put down my deposit, for sure. Luckily I think I'll slide in right under and still be okay. Maybe I'll see the truck in 2022 but that is fairly wishful thinking.

The income cap is unbelievably stupid, completely counterproductive, and is only there because of Joe Manchin and his twisted perspectives on what anyone outside of WV is dealing with regarding cost of living.

EV prices, because the supply of rare earth minerals is extremely constrained, have gone UP not down as manufacturers have moved to scale. By imposing an income cap you are effectively applying a tax on people in that income category of $7500. That, psychologically and financially disincentivizes people and the goal should be the opposite.

 

[mabowden]

In my case, it may prevent me from purchasing the R1T and I think it may likely impact a lot of other reservation holders as well because it is hard to justify the cost of the vehicle because many of us were factoring in the EV credit in our buying decision.

The income cap is completely unnecessary and counterproductive. All it does is disincentivize the consumer from purchasing an electric vehicle because the point of the credit is to offset the higher cost of an EV relative to an ICE vehicle irrespective of your financial situation.

The intent should be to put more electric vehicles on the road and replace or offset ICE vehicles. EVs, because of supply constraints have significantly increased in cost relative to ICE vehicles (look at the price increases for Tesla and RIVIAN as examples). When the phase-out of the original credit was put in place the idea was that once a manufacturer has scale, they should be able to make the EV affordable but that hasn't happened.

The tax credit was a counterweight to EV specific price increases.

It likely won't not stop me, but I'm definitely not excited about it. I've been saving for a while knowing this is coming. I might be under the income limits, it's going to be close. 300k in socal maybe will get in you in a single family residence if you are a millennial. Luckily I bought a house as soon as I could afford one (equity) otherwise there is no way I would be where I'm at now.

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