The rules surrounding EV tax rebate eligibility change for 2024 and it starts in just a few weeks. There are still a lot of unanswered questions about which cars will be eligible for the full $7,500 federal incentive. Unlike the current system, which requires you to take the discount from the purchase of the car as a reduction in your tax bill when you file taxes, the new system will allow dealers to take the full amount as an instant discount from your purchase price, and it’ll be applied to your taxes after the fact. The new system is a bit more stringent, however, requiring a lower MSRP cap and a battery built in the U.S. to be eligible. So which cars fit the bill?
The point of this change is to provide incentives for automakers to build their batteries and source their materials in the U.S. as an effort to prop up the U.S. industry against China’s dominance. China currently produces about 70 percent of all electric vehicle batteries, and this federal program seeks to level the playing field a bit. EVs with battery materials sourced from “foreign entities of concern” [China, North Korea, and Russia, namely] will get no federal incentive at all. Cars with at least 50 percent of materials sourced in North America, or another of the 20 countries the U.S. has a free trade agreement with, will be eligible for $3,750 of the rebate.
The Lyriq has a silly name, but looks gorgeous and seems to be priced really well in the market. It starts at $58,590, so you can theoretically get a base model for just a smidge over 50.
Chevrolet Blazer EV
The Blazer EV starts at $56,715, and it’s certainly a fetching automobile. I’m not sure I’d pick one of these over a Lyriq, but it’s an option.
Chevrolet Bolt EV and EUV
Bolt remains one of the best cheap EVs on the market, and with the full $7,500 rebate will technically start under $20,000. If you’re looking for a good cheap commuter, you can’t really go wrong with this one.
Chevrolet Equinox EV
If the Bolt is too small for you, the Equinox is supposed to start around $35,000 before incentives, and will provide a much larger interior for you and your family. It looks okay, I guess.
Chevrolet Silverado EV
The Silverado EV won’t be cheap, starting at around $75,000, but it still falls under that $80,000 threshold. You’ll have to be very selective about your options if you want to get the tax rebate, but if you need a truck it might be an option.
Ford F-150 Lightning
If you really want an electric truck, you’re probably looking at the Ford F-150 Lightning. With a starting price of $49,995, it’s a bit closer to reality for most Americans. You would be able to option one pretty well and still fall under the rebate MSRP cap, too.
Tesla Model 3 Performance
The Tesla Model 3 Performance starts at $50,990, so you can’t add a lot to this car in order to get it under the incentive structure. You can get an optional $2,000 paint color, but the $6,000 driver assistance “Autopilot” package would put it over the limit.
Tesla Model Y
The Tesla Model Y Performance is a bit more expensive than its Model 3 counterpart at $52,490, but it’s labeled an SUV rather than a sedan, so you can go wild with options. It isn’t clear if the RWD Model Y and Model Y Long Range have batteries that fit the criteria of the incentive structure, so you’ll have to ask Tesla when you order if it is or not when the time comes. If it does fit the program, you might be able to get a Tesla for less than $40,000 after incentives.
Tesla Model X
The Dual Motor All-Wheel Drive Model X is technically eligible as an SUV with a $79,990 price tag. You won’t be able to get any options, though, so I hope you like your gullwing door egg in white.
Chrysler Pacifica PHEV
The only plug-in hybrid on the list eligible for the full $7,500 is the Chrysler Pacifica PHEV. It has a battery large enough to qualify, and its materials are all sourced from and made in North America. Isn’t that neat? If you were looking for a van, here’s a good way to save fuel and get a $7,500 coupon.
There are currently only ten vehicles sold in the U.S. that are eligible for the full federal rebate. Big three plus Tesla, that’s it. There are a few that still qualify for the half-rebate rate, and a few more PHEVs, but not many. Personally, I hope all of these tax rebates are spent on Bolts, because that’s a good cheap car for people who have been complaining that there’s no cheap EVs. If you actually go buy the cheap EVs, maybe more companies will offer cheap EVs.
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