Which 2024 electric vehicles qualify for the $7,500 electric vehicle tax credit?
The list of electric vehicles eligible for the electric vehicle tax credit in calendar year 2024 has been released. And as expected, it is very short.
Tesla’s notable omissions include most of the Model 3 lineup (the Performance version is the only one that now qualifies) as well as the entire Model S lineup. And as expected by automakers in recent weeks, the Chevrolet Blazer EV and Cadillac Lyriq don’t yet make the list, while the Ford Mustang Mach-E is completely disqualified for now. The Nissan Leaf is not on the list yet either.
Also of note: Currently, no Rivian electric truck is eligible for the full $7,500 tax credit amount in 2024. The credit amount for these models has decreased to $3,750.
2024 Chevrolet Blazer EV RS
Stricter rules on the origin of electric vehicle batteries = fewer qualified people
In most of these examples, this is because the tax credit, as revised under the Inflation Recovery Act of 2022, Phases in stricter rules for the origin of battery components and critical minerals.
Starting in 2024, in addition to North American assembly, 60% of battery parts must come from North America to be eligible for half the credit amount ($3,750). That’s an increase from the 50 percent requirement for 2023.
The other $3,750 is based on the condition that at least 50% of the critical mineral content in batteries comes from North America (or from countries with a free trade agreement).
2023 Ford Mustang Mach-E
Applying a China filter
While automakers have known about these rules for at least 16 months, there is another dealbreaker that was only recently announced. As the Department of Energy outlined just a month ago on December 1st, starting January 1st, all vehicles with key battery components may come from a “foreign company of concern” – China, Russia, Iran or North Korea.will be disqualified in 2024This also applies to corporate subsidies if a “parent company” from one of these countries directly holds more than 50% of the car manufacturer’s shares.
In 2025, tax credit rules will be expanded to include the mining, processing and recycling of critical minerals. This is all part of a broader push by the Biden administration to promote a domestic electric vehicle supply chain.
For automakers and suppliers, these changes in battery levels can also pose other logistical hurdles for motors, inverters and other powertrain components.
2023 BMW i7 xDrive60
The electric vehicle leasing gap continues
This does not apply to leasing electric vehicles Gap in electric vehicle leasing continues to apply the full $7,500 in federal funds to commercial vehicles regardless of their origin, domestic content or price – effectively meaning in many cases the federal government is subsidizing imported luxury electric vehicles.
The credit becomes a dealer discount
As the EPA emphasizes in its listing, buyers must verify the vehicle identification number (VIN) to ensure that a particular electric vehicle on the sale lot qualifies for the credit. Currently, this is done in a proprietary way for each automaker – GM will be rolling out a VIN verification tool at its dealers, for example – but that’s another thing that could potentially be centralized in the near future.
Also of note: The electric vehicle tax credit will an immediate dealer discount in 2024This gives electric vehicle buyers immediate access to the loan and the ability to finance a lower amount up front for the vehicle. This requires a declaration from the buyer that they are qualified and traders must register with the IRS. With less than half of the franchises Traders registered for the tax credit By the end of the year, even this aspect will be chaotic.
Income and price caps have been in effect since the beginning of 2023. To claim the credit for an electric vehicle purchase, buyers must meet an adjusted gross income limit of $300,000 for married couples filing jointly, $225,000 for head of household, or $150,000 for other filers. Vehicle price caps of $55,000 for new cars and $80,000 for pickup trucks, SUVs and vans also apply.
2024 Rivian R1T
Which models are suitable?
Here’s the list of models that will make it in 2024 – qualifying for the full $7,500 unless otherwise noted:
2022-2023 Chevrolet Bolt EV
2022-2023 Chevrolet Bolt EUV
2022-2024 Chrysler Pacifica EV
2022-2024 Ford Escape Plug-In Hybrid ($3,750)
2022-2024 Ford F-150 Lightning (Extended Range and Standard Range)
2022-2024 Jeep Grand Cherokee 4xe ($3,750)
2022-2024 Jeep Wrangler 4xe ($3,750)
2022-2024 Lincoln Corsair Grand Touring ($3,750)
2023-2024 Rivian R1S (twin and four engines, large and maximum package) ($3,750)
2023-2024 Rivian R1T (twin and four engines, bulk package) ($3,750)
Tesla Model 3 2023-2024 Performance
2023-2024 Tesla Model X Long Range
2023-2024 Tesla Model Y (Performance and 4WD)
2024 Tesla Model Y (Rear Wheel Drive)
