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

[Nuclianba]

It creates a binding legal contract, but not a purchase contract.

I see. Well that's a mood killer...can you educate me on what the difference is and what needs to be in a contract to be a 'purchase' contract? The current wording of the bill states we need a "...binding contract to purchase...". I figured the wording in the PBA (binding legal contract, and I agree "...to purchase the Vehicle...") fit the bill

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[sacramentoelectric]

Would love somebody with a legal degree to comment on this. My untrained eye sure thinks the PBA is binding. The guides describe them as less than binding, probably to encourage signing them, but the legalese suggests otherwise. It states on the first page in all caps that "THIS AGREEMENT CREATES A BINDING LEGAL CONTRACT". A paragraph later: "You agree to purchase the Vehicle as described in your saved configuration as of the date of this Agreement from Rivian, LLC. or its affiliate". No termination provisions for the order for me I can find. Contractually requires Rivian to sell at the prices as of the date of the agreement. They have outs from the contract but they can't terminate for convenience, only if they discontinued the configuration I've ordered. If I fail to take delivery, I'm responsible for any and all costs related to the failure to accept.


This matters to me as I'm a Max pack reservation holder who got a guide and signed a PBA a couple months ago. Would be great to know that although my truck isn't showing up until 2023 (saying a prayer) my PBA from June should grandfather me in to the old credit....

I would sign a purchase agreement in a heartbeat and forfeit any chance of recovering my deposit if it meant locking in the 2021 rebate. The options I've picked that pushed my delivery estimate to 2023 just aren't worth losing out on a $7500 rebate. To me anyway. I'm not a lawyer but the way you describe the PBA sure seems to be within the spirit and letter of the proposed new law.

 

[JayinNJ]

Doesn’t negatively impact the vast majority of people. Add to that the fact that it’ll now be a point of sale rebate and it’s a big win for the vast majority of people. So yea, I’m totally good with it.

I disagree since the sedan price cap is pretty low. Plenty will get affected.

 

[R1Sky Business]

I disagree since the sedan price cap is pretty low. Plenty will get affected.

Don't forget about battery components origin.....

 

[ads75]

I disagree since the sedan price cap is pretty low. Plenty will get affected.

If it really was about getting people to drive more efficient vehicles sedans should have a rebate the same as or more than SUVs/trucks.

 

[R1Sky Business]

If it really was about getting people to drive more efficient vehicles sedans should have a rebate the same as or more than SUVs/trucks.

But it's not about that....

 

[Gshenderson]

I see. Well that's a mood killer...can you educate me on what the difference is and what needs to be in a contract to be a 'purchase' contract? The current wording of the bill states we need a "...binding contract to purchase...". I figured the wording in the PBA (binding legal contract, and I agree "...to purchase the Vehicle...") fit the bill

I thought we were talking about the reservation agreements, not PBA’s. PBA’s might qualify.

Generally the way things work in government is that Congress passes a law, and then various agencies then write implementing regulations for that law. Sometimes the law is very specific, so it’s clear what the details of the regs will be; so,e times not. The current draft seems to have some of both. So it may be awhile before we really know for sure.

 

[sac602]

The bill requires automakers to use "critical minerals" for their batteries that were extracted and processed in North America or a country the U.S. has a trade agreement with. The bill requires qualifying clean vehicles to use a minimum amount of such minerals, starting at 40 percent for vehicles put into service before January 2024, then going up by 10 percent a year until it reaches 80 percent for vehicles placed in service after December 31, 2026. Similarly, all qualifying clean vehicles need to have their battery components manufactured or assembled in North America at a similar increasing scale, starting at 50 percent for vehicles put into service before January 1, 2024. I dont think 50% of the batteries re manufactured or assembled in North America. Hope Im wrong.
Reuters reported the batteries are sourced from South Korea (Samsung). It appears the US and South Korea have a Free Trade Agreement (KORUS FTA) signed Juen 30, 2007. ug.

 

[mkg3]

"No. There is another"

Kyrsten Sinema may still save us from the Spend and tax side...

 

[Autolycus]

The bill requires automakers to use "critical minerals" for their batteries that were extracted and processed in North America or a country the U.S. has a trade agreement with. The bill requires qualifying clean vehicles to use a minimum amount of such minerals, starting at 40 percent for vehicles put into service before January 2024, then going up by 10 percent a year until it reaches 80 percent for vehicles placed in service after December 31, 2026. Similarly, all qualifying clean vehicles need to have their battery components manufactured or assembled in North America at a similar increasing scale, starting at 50 percent for vehicles put into service before January 1, 2024. I dont think 50% of the batteries re manufactured or assembled in North America. Hope Im wrong.
Reuters reported the batteries are sourced from South Korea (Samsung). It appears the US and South Korea have a Free Trade Agreement (KORUS FTA) signed Juen 30, 2007. ug.

Rivian assembles the _battery pack_ in the US. I wouldn't be surprised if that counts for a while. Only time will tell if that's sufficient or if the battery _cells_ have to manufactured here.

 

[tren01t]

"No. There is another"

Kyrsten Sinema may still save us from the Spend and tax side...

She will sabotage it. Get primaried when up for relection then end up working at the fashion bug. The end lmao

 

[James]

Elektrek seems to have parsed out the draft language:

https://electrek.co/2022/07/27/senate-moves-forward-ev-tax-credit-reform-tesla-tsla/

• Federal tax credit for EVs maintained at $7,500
  • Eliminates tax credit cap after automakers hit 200,000 EVs sold, making GM and Tesla once again eligible
  • The language in the bill indicates that the tax credit would be implemented at the point of sale instead of on taxes.
  • In order to get the full credit, the electric vehicle needs to be assembled in North America, the majority of battery components need to come from North America, and contain a certain percentage of minerals from countries with free trade agreements with the US.
• A new federal tax credit of $4,000 for used EVs
• Zero-emission vans, SUVs, and trucks with MSRPs up to $80,000 qualify
• Electric sedans priced up to $55,000 MSRP qualify
• The full EV tax credit will be available to individuals reporting adjusted gross incomes of $150,000 or less, $300,000 for joint filer

 

[WhidbeyIsland]

Does anyone know if the Rivian Batteries will meet the tax credit requirements?

 

[Autolycus]

Does anyone know if the Rivian Batteries will meet the tax credit requirements?

Nope, and nobody will at least until the bill passes and Treasury issues implementing regs. Even with those, we’ll probably have to wait to hear from Rivian and other manufacturers about each specific model.

 

[Deleted member 1377]

The proposed income cap for the $7,500 POS credit is $150k and $300k married.

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