2022 vs 2023 Tax credit…Again

[Gavinmcc]

I am still confused and some new information appeared on some sites (and it seems there is still some plans to try and amend the 2023 law, but I seriously doubt anything will come out of a divided Congress). No political talk please

It seems that while the 2022 purchases get the full 7,500 rebate/refund, that 2023 purchases get 0 rebate?

Seems a huge drop, especially for a made in America vehicle.

I take it the batteries are the issue? Made in China?

Any info would be great just because it looks like I won’t get my truck till January.

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[Prime]

I am still confused and some new information appeared on some sites (and it seems there is still some plans to try and amend the 2023 law, but I seriously doubt anything will come out of a divided Congress). No political talk please

It seems that while the 2022 purchases get the full 7,500 rebate/refund, that 2023 purchases get 0 rebate?

Seems a huge drop, especially for a made in America vehicle.

I take it the batteries are the issue? Made in China?

Any info would be great just because it looks like I won’t get my truck till January.

Well not just the battery and build issue. The 2023 rules for the tax credit also applied a max price of $80k and an income limit. Lots of obstacles

 

[mkg3]

I think you should stop reading about it on the web. Instead, seek CPA for advise and clarification, when time comes for you to take action.

"new information appeared on some sites" only feeds your uncertainties....

 

[RYU]

i don't mean to add further variables but it's my understanding that if you signed the purchase contract in Aug 2022 you are eligible via the old rules (e.g. $7500, no income limit) even if the vehicle isn't delivered in 2022. Someone correct me if i'm wrong.

I'm clarifying this because this differs slightly from what you mentioned above in terms of 2022 vs 2023 purchases.

 

[Prime]

i don't mean to add further variables but it's my understanding that if you signed the purchase contract in Aug 2022 you are eligible via the old rules (e.g. $7500, no income limit) even if the vehicle isn't delivered in 2022. Someone correct me if i'm wrong.

I'm clarifying this because this differs slightly from what you mentioned above in terms of 2022 vs 2023 purchases.

Would this then be applied to your 2022 tax returns or 2023 if the vehicle delivered in 2023 but purchase agreement signed in 2022? I have not talked to my CPA about this yet just curious if anyone has.

 

[Gavinmcc]

I am not sure the purchase agreement will work. But maybe?

If not:

1. Vehicle must be assembled in North America to qualify for new credit. (Page 366, line 15)
   
   
2. $3,750 of the new credit is based upon the vehicle having at least 40% of its battery critical minerals from the United States or countries with a free trade agreement with the United States. This is a list of countries with free trade agreements with the US. (Page 371)
3. The other $3,750 of the new credit is based on at least 50% of the battery components of the vehicle coming from the United States or countries with a free trade agreement with the US. (Page 372, line 13)

So one is fine, but I don't think Rivian matches either of 2 or3

https://electrek.co/2022/11/16/which-electric-vehicles-still-qualify-for-us-federal-tax-credit/

They think these will work in 2023 for some reason?

RIVIAN
EDV 700 (2022)	$7,500
R1T (2022) (Dual Motor Adventure only)	$7,500
R1S (2022) (Dual Motor Adventure only)	$7,500

 

[RYU]

Would this then be applied to your 2022 tax returns or 2023 if the vehicle delivered in 2023 but purchase agreement signed in 2022? I have not talked to my CPA about this yet just curious if anyone has.

That's an interesting question. I, too have to chat with my CPA. I'm not sure if you have to take the tax credit on the date of purchase Aug 22' or if it's on the date you disperse the cash which could be 2023/24. Then do you have to amend the 22 tax return? I have zero clue what's the right answer.

 

[COdogman]

I am pretty much the opposite of a CPA or financial advisor (I invest in Bourbon and bicycles ), but the way I understand it if you were able to get the Rivian BPA some months back but did not receive your truck until 2024 you would simply need to have your CPA amend your 2022 return to apply the credit.

The 2023 credit pretty much could not be more confusing if they tried, so as others suggested I would ask your CPA to interpret that one. The $80k limit is pretty straightforward, but the battery sourcing requirements are very confusing and many manufacturers are still trying to figure out where all their battery materials come from. I believe those don't start until 2024 though. So in 2023 the price limit and assembled origin are the parts that take effect immediately.

I could still be wrong about all of that. Just my interpretation...

 

[connoisseurr]

There is a new bill floating through congress titled Affordable Electric Vehicles for America Act of 2022, that would delay many requirements that were put in place within the IRA.

https://electrek.co/2022/11/07/new-electric-vehicles-would-qualify-for-tax-credit-with-new-bill/

Text - S.5020 - 117th Congress (2021-2022): Affordable Electric Vehicles for America Act of 2022 | Congress.gov | Library of Congress

 

[Gavinmcc]

I guess if they can put it to vote before end of year it might pass, but after that I seriously doubt it.

Would be nice. When did Rivian send out the binding agreement?

Looks like August 16th...which is a potential big issue:

If you entered into a written binding contract to purchase a new qualifying electric vehicle before August 16, 2022.

That BEFORE is huge.

 

[TexasCrane]

Looking at my e-mail, it looks like Rivian offered the binding contracts on Aug 10.

 

[Gavinmcc]

Great!

 

[Gavinmcc]

Hopefully it works

 

[RYU]

I guess if they can put it to vote before end of year it might pass, but after that I seriously doubt it.

Would be nice. When did Rivian send out the binding agreement?

Looks like August 16th...which is a potential big issue:

If you entered into a written binding contract to purchase a new qualifying electric vehicle before August 16, 2022.

That BEFORE is huge.

August 10, 2022

Here's the verbage. Apologies for the formatting. Copy/Pasting from a PDF removes all formatting). If you read it it's not exactly a concrete agreement but it's concrete enough to form a binding agreement IMO (i'm neither an accountant nor a lawyer! haha)

RIVIAN BINDING CONTRACT TO PURCHASE This RIVIAN BINDING CONTRACT TO PURCHASE (this “Agreement”) creates a binding obligation for you to purchase (the “Order”) a Rivian R1 vehicle (the “Vehicle”) and governs the terms of your Order. Rivian’s General Terms and Conditions contained at Rivian.com/legal/terms (“Rivian Terms”) are hereby incorporated by reference into this Agreement. 1. Agreement to Purchase & Deposit. As of the date of this Agreement (“Order Date”), you agree that you shall purchase the Vehicle from Rivian, LLC, or its affiliate (“we,” “us” or “our”), pursuant to the terms and conditions of this Agreement. You hereby create a binding contract with Rivian obligating you to purchase the Vehicle. Immediately prior to taking delivery of the Vehicle you will be required to sign a dealership-specific Rivian Motor Vehicle Purchase Agreement that contains further terms and conditions. As part of the consideration you provided to Rivian for this Order, one hundred dollars of the deposit amount you submitted with your preorder/reservation becomes non-refundable. 2. Vehicle Pricing. Contingent on product availability, the Vehicle pricing is shown in the configuration accessible through your Rivian account. If you do not have a configuration associated with the reservation in your Rivian account, you will confirm a configuration and review applicable estimated pricing in advance of Rivian building the Vehicle. Vehicle prices available at the time of your Order are only an estimate based on available features and options at the time of order. Options, features or hardware released or changed after you place your Order might not be included in or available for your Vehicle. Prices shown do not include taxes, title, license or other fees paid to third parties, which could be material costs. Because taxes and fees vary over time and jurisdiction, they are a best estimate and will be calculated prior to delivery based on all available information and indicated on your final Rivian Motor Vehicle Purchase Agreement. You are responsible for these taxes and fees. All prices posted on the Rivian website are subject to change without notice. Your final price will be reflected on the Rivian Motor Vehicle Purchase Agreement. 3. Order Changes. If you make changes to the Vehicle after the Order Date, you may lose eligibility for special edition models, your place in line for priority delivery, and/or be subject to potential price increases based on any pricing adjustments made since the Order Date. 4. Disclaimer of Tax Eligibility. Rivian cannot guarantee that you will be eligible for any tax credits because you signed this Agreement. You are responsible for your own personal tax situation and determination of eligibility for credits and incentives for Federal, State, and Local taxes. Rivian does not guarantee the actions or determinations of the Internal Revenue Service or any other tax authority, and Rivian is under no obligation to defend you in disputes with any tax authority. Rivian makes no representations under this Agreement as to pending or future legislation. 5. Privacy Policy and Terms of Use. The data Rivian and/or its affiliates collects from or about you or your Vehicle will be used in accordance with our Privacy Policy and Rivian Terms, each of which is incorporated herein by reference and available on our website at rivian.com/legal/privacy and rivian.com/legal/terms. Please read our Privacy Policy and Rivian Terms carefully to understand the data that we collect and our practices regarding your information and how it will be treated. If you have questions regarding our Privacy Policy or Rivian Terms, you should contact us by email at [email protected]. 6. Modification. This Agreement may not be modified or changed unless expressly agreed to in writing signed by Rivian. 7. No Waivers. The failure by Rivian to enforce any right or provision of this Agreement will not constitute a waiver of future enforcement of that right or provision. The waiver of any right or provision will be effective only if in writing and signed by a duly authorized representative of Rivian. 8. Assignment. You may not assign your rights or delegate your obligations under this Agreement without our express prior consent. Rivian may assign this Agreement and delegate its obligations hereunder in our discretion without your consent. Any assignment or delegation in violation of this Agreement will be null and void. 2 CUSTOMER COPY – FOR CUSTOMER RECORDS v. (08/22) 9. No Resellers & Cancellation. While this Agreement creates a binding Order for you to purchase the Vehicle when built by Rivian, this Agreement does not create an obligation by Rivian to build the Vehicle. Rivian and its affiliates may unilaterally cancel any order that we believe has been made with the intent to resell the Vehicle or otherwise has been made in bad faith. Rivian may also cancel your Order if a vehicle, product, feature, or option is discontinued after you place your Order. 10. LIMITATION OF LIABILITY. No Consequential or Indirect Damages. EXCEPT AS OTHERWISE PROVIDED BY APPLICABLE LAW, IN NO EVENT SHALL RIVIAN OR ANY OF ITS AFFILIATES, AND/OR THEIR RESPECTIVE OFFICERS, EMPLOYEES, LICENSORS AND PARTNERS BE LIABLE TO YOU OR ANY THIRD PARTY FOR CONSEQUENTIAL, INDIRECT, INCIDENTAL, SPECIAL, EXEMPLARY, PUNITIVE OR ENHANCED DAMAGES ARISING OUT OF, RELATING TO, OR IN CONNECTION WITH THIS AGREEMENT, REGARDLESS OF (A) WHETHER SUCH DAMAGES WERE FORESEEABLE; (B) WHETHER OR NOT A PROPOSED DEFENDANT WAS ADVISED OF THE POSSIBILITY OF SUCH DAMAGES; AND (C) THE LEGAL OR EQUITABLE THEORY (CONTRACT, TORT OR OTHERWISE) UPON WHICH THE CLAIM IS BASED. Maximum Liability. EXCEPT AS OTHERWISE PROVIDED BY APPLICABLE LAW, IN NO EVENT SHALL RIVIAN’S OR ANY OF ITS AFFILIATES, OR THEIR RESPECTIVE OFFICERS, EMPLOYEES, LICENSORS AND PARTNERS AGGREGATE LIABILITY ARISING OUT OF OR RELATED TO THIS AGREEMENT, WHETHER ARISING OUT OF OR RELATED TO BREACH OF CONTRACT, TORT (INCLUDING NEGLIGENCE) OR OTHERWISE, EXCEED THE TOTAL OF THE AMOUNTS YOU PAID TO RIVIAN PURSUANT TO THIS AGREEMENT. To the extent any jurisdiction does not allow the exclusion or limitation of direct, incidental, punitive or consequential damages, portions of the above limitations or exclusions may not apply. 11. DISPUTE RESOLUTION – ARBITRATION AGREEMENT AND CLASS ACTION WAIVER THIS AGREEMENT REQUIRES THE USE OF ARBITRATION ON AN INDIVIDUAL BASIS TO RESOLVE DISPUTES, RATHER THAN JURY TRIALS OR CLASS ACTIONS AS DESCRIBED IN THE “DISPUTE RESOLUTION – ARBITRATION AGREEMENT AND CLASS ACTION WAIVER” SECTION OF THE RIVIAN TERMS FOUND AT RIVIAN.COM/LEGAL/TERMS, AND THAT SECTION IS HEREBY INCORPORATED BY REFERENCE INTO THIS AGREEMENT. 12. Choice of Law. This Agreement, its subject matter and its formation, and any related non-contractual disputes or claims, are governed by the laws of the State in which Rivian is licensed to sell motor vehicles that is nearest to your delivery address, without regard to choice or conflict of law principles, except as otherwise provided in the Arbitration Agreement.

 

[R1TJ]

... if you were able to get the Rivian BPA some months back but did not receive your truck until 2024 you would simply need to have your CPA amend your 2022 return to apply the credit.

Beginning in 2024 the rebate can be applied at the point of sale. Silver lining for those of us with a long wait?

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