Last Call for Electric-Car Tax Credit?
Congress is considering pulling the plug on a lucrative tax credit for buyers of electric cars and plug-in hybrids.
Time could be running out on the chance for new-car buyers to pocket a tax credit worth up to $7,500 for the purchase of a new electric or plug-in hybrid vehicle.
The tax overhaul plan passed by the House of Representatives includes a provision that would unplug the credit at the end of 2017. The Senate plan does not make that change, but some Senators are pushing for it and electric-car advocates fear it could find its way into the final legislation. Under current law, the tax credits are available until each manufacturer has sold 200,000 qualifying vehicles.
The Electric Vehicle Association of Greater Washington D.C., a non-profit advocacy group that promotes the technology, has a nifty fact sheet that shows over 30 vehicles that currently qualify for the credit. Ron Kaltenbaugh, president of the group, says the “uncertainty over the future of the credit is frustrating for people who have made plans to buy an electric vehicle.”
But Kaltenbaugh warns against letting the potential demise of the credit stampede you into buying a new car by New Year’s Eve. For one thing, he notes that several pure electric vehicles with longer driving ranges will arrive on the market soon. But if you’re planning to buy a hybrid electric/gas vehicle such as the Chevy Volt or Chrysler Pacifica Hybrid, for which a $7,500 credit could cover nearly 20% or even more of the purchase price, you might want to try to beat the deadline.
Again, it’s unclear whether the credit will end at the end of 2017. But, if it does, you’ll need to have your new car registered in your name by the end of the year to claim the credit on your 2017 tax return. Simply ordering it won’t lock in the credit. For more information about the credit, check out this IRS Web page.