Author Topic: Post FIRE Electric vehicle purchase  (Read 492 times)

superd

  • 5 O'Clock Shadow
  • *
  • Posts: 21
  • Age: 47
  • Location: Portland
Post FIRE Electric vehicle purchase
« on: March 05, 2021, 03:10:44 PM »
Hi all.. Iíve been looking at a few different options for an electric car: Prius prime or crosstrek phev which have a 4500 federal tax rebate. Given my income is dividends at 0% and side gig / other taxable income is less than the $12,000 standard deduction I have no taxes to take advantage of the non-refundable doesnít rollover credit. If I take IRA distribution to get $4500 in taxes Iíd lose the ACA premium reduction of around the same value.

Has anyone encountered this dilemma and had a dealer offer a solution to get the credit via a lease or other fancy paperwork ? Or another way to find taxable income without losing aca credit ?

innkeeper77

  • Bristles
  • ***
  • Posts: 262
Re: Post FIRE Electric vehicle purchase
« Reply #1 on: March 05, 2021, 03:25:51 PM »
Sometimes you can buy essentially new cars for slightly more than MSRP minus incentives. We did that for a PHEV (Honda Clarity- a PHEV with a large enough range and battery to qualify for the $7500 rebate) for environmental reasons (Not at all financial..), It also made the whole paperwork process a lot easier, and we were able to finance it at close to mortgage level interest rates. Ours had only 17 miles on it as a used car.

superd

  • 5 O'Clock Shadow
  • *
  • Posts: 21
  • Age: 47
  • Location: Portland
Re: Post FIRE Electric vehicle purchase
« Reply #2 on: March 05, 2021, 05:39:12 PM »
Sometimes you can buy essentially new cars for slightly more than MSRP minus incentives. We did that for a PHEV (Honda Clarity- a PHEV with a large enough range and battery to qualify for the $7500 rebate) for environmental reasons (Not at all financial..), It also made the whole paperwork process a lot easier, and we were able to finance it at close to mortgage level interest rates. Ours had only 17 miles on it as a used car.

Hi yes, Iíve seen that on loaner and test drive cars near the end of the model year. Sounds like you got a great deal on the clarity!

Iíve talked with a couple Toyota dealers and confirmed Toyota wonít roll the tax credit into a lease and pass it on to the lessee. Subaru does, but the interest rate in their lease contract is 6% so that eats up most of the credit combined with the extra lease document fees when compared to normal finance rate or cash.

Biden did talk about changing the ev credit during the campaign, hopefully itís turned into a refundable or rollover eligible credit then Iíll offset some Roth conversions while staying in same ACA subsidy level over a few years.