[MTN Ranger]

Good news, it looks like the One orders will be good for the credit with the transition rule.

I just noticed that the IRS has updated form 8936. Interestingly the form is updated, but the instructions are not. There is a draft instructions link, but I'm not sure how much will change. Here are the links:
2023 Form 8936
2022 Instructions
Draft 2022 Instructions

In the draft, the transition rule is now mentioned!
"Line 3
Enter 08/15/2022 if you qualify and elect to apply the transition rule discussed below. Transition rule. If you purchased, or entered into a written binding contract to purchase, a qualified plug-in electric drive motor vehicle after 2021 and before August 16, 2022, you may elect to treat such vehicle as having been placed in service on August 15, 2022, the day before the enactment date of the Inflation Reduction Act of 2022. Any additional election guidance that is issued will be added to these instructions at a later date."

 

[TT97]

Good news, it looks like the One orders will be good for the credit with the transition rule.

I just noticed that the IRS has updated form 8936. Interestingly the form is updated, but the instructions are not. There is a draft instructions link, but I'm not sure how much will change. Here are the links:
2023 Form 8936
2022 Instructions
Draft 2023 Instructions

In the draft, the transition rule is now mentioned!
"Line 3
Enter 08/15/2022 if you qualify and elect to apply the transition rule discussed below. Transition rule. If you purchased, or entered into a written binding contract to purchase, a qualified plug-in electric drive motor vehicle after 2021 and before August 16, 2022, you may elect to treat such vehicle as having been placed in service on August 15, 2022, the day before the enactment date of the Inflation Reduction Act of 2022. Any additional election guidance that is issued will be added to these instructions at a later date."

What a clusterf*&^.

 

[TESLAMIZE]

What a clusterf*&^.

Seems pretty straight forward to me. Unless the final draft includes are hard cutoff date, then we are good on the credit. Straightening out when you file might be a pain, but Ill put a few hours in if it means I get $7500.

 

[MTN Ranger]

Seems pretty straight forward to me. Unless the final draft includes are hard cutoff date, then we are good on the credit. Straightening out when you file might be a pain, but Ill put a few hours in if it means I get $7500.

Exactly. If you get the VIN before April 18th, file the tax return with form 8936 for the $7500 credit. If not, file an extension or amend the 2022 tax return.

 

[TT97]

Seems pretty straight forward to me. Unless the final draft includes are hard cutoff date, then we are good on the credit. Straightening out when you file might be a pain, but Ill put a few hours in if it means I get $7500.

It's good as it is currently written but "any additional election guidance that is issued will be added to these instructions at a later date" is a huge caveat. I should have specified the Act is more of a clusterf*&^ than the IRS's attempt at interpreting the Act. But at least 2023 will be even more of a [fill in prefered adjective here] with the first two months ignoring the battery requirements component of the Act and then theoretically being implemented in March.

 

[TESLAMIZE]

It's good as it is currently written but "any additional election guidance that is issued will be added to these instructions at a later date" is a huge caveat. I should have specified the Act is more of a clusterf*&^ than the IRS's attempt at interpreting the Act. But at least 2023 will be even more of a [fill in prefered adjective here] with the first two months ignoring the battery requirements component of the Act and then theoretically being implemented in March.

 

[Misanoblue]

Makes sense for my One.

but… I also have binding contract on a 2nd ocean which was only $100. What if I claim that too on 2022 taxes, pocket $7500, then back out of the deal??? Oh boy.

 

[Bill Tatun]

Makes sense for my One.

but… I also have binding contract on a 2nd ocean which was only $100. What if I claim that too on 2022 taxes, pocket $7500, then back out of the deal??? Oh boy.

Can’t claim the credit until you take possession of the vehicle (title in your name),. 😎

 

[macgirk]

The IRS Website still states you must take possession of the vehicle before January 1, 2023 to qualify. Note on the form also states "This credit is for qualified plug-in electric drive motor vehicles placed in service before 2023, qualified two-wheeled plug-in electric vehicles acquired before but placed in service in 2022, and new clean vehicles placed in service after 2022." The key there is "new clean vehicles placed in service after 2022" are subject to the assembly and battery requirements. I imagine they will include the possession language for the final, but we'll see. None of this helps Ocean buyers get the credit.

 

[TESLAMIZE]

The IRS Website still states you must take possession of the vehicle before January 1, 2023 to qualify. Note on the form also states "This credit is for qualified plug-in electric drive motor vehicles placed in service before 2023, qualified two-wheeled plug-in electric vehicles acquired before but placed in service in 2022, and new clean vehicles placed in service after 2022." The key there is "new clean vehicles placed in service after 2022" are subject to the assembly and battery requirements. I imagine they will include the possession language for the final, but we'll see. None of this helps Ocean buyers get the credit.

It doesn't say must it says if. Either way, it still needs work, but I suspect we wont have to wait long once these Ones start getting delivered.

 

[macgirk]

It doesn't say must it says if. Either way, it still needs work, but I suspect we wont have to wait long once these Ones start getting delivered.

Semantics. The 'If" has to do with the fact we are entering into a purchase agreement, not about possession. Read it how you want, but if you take possession in 2023 or after, you are not eligible.

"If you entered a written binding contract to buy a vehicle before August 16, 2022, but took possession on or after August 16, 2022, and before January 1, 2023, you may claim the credit based on the prior rules and disregard the assembly requirement."

 

[S7davis]

Sorry to say but the stipulation added I think last week says if you have put money down and converted to order and have a signed agreement it will qualify under old rules. Even if it is not delivered until 2023. As they will allow the in service date to be day before signed BILL.

 

[macgirk]

Sorry to say but the stipulation added I think last week says if you have put money down and converted to order and have a signed agreement it will qualify under old rules. Even if it is not delivered until 2023. As they will allow the in service date to be day before signed BILL.

Do you have a link to that? Can't find anything on the IRS site that would allow that. As everything is written now, it doesn't make any sense why they would change the possession rule. All this should be sorted out in March.

 

[TT97]

Semantics. The 'If" has to do with the fact we are entering into a purchase agreement, not about possession. Read it how you want, but if you take possession in 2023 or after, you are not eligible.

"If you entered a written binding contract to buy a vehicle before August 16, 2022, but took possession on or after August 16, 2022, and before January 1, 2023, you may claim the credit based on the prior rules and disregard the assembly requirement."

Ther updated draft instructions state:

https://www.irs.gov/pub/irs-dft/i8936--dft.pdf

Still a draft so not final but no 1/1/23 reference.

 

[macgirk]

Ther updated draft instructions state:

View attachment 3526

https://www.irs.gov/pub/irs-dft/i8936--dft.pdf

Still a draft so not final but no 1/1/23 reference.

This is a draft which is why I stated in my original post "I imagine they will include the possession language for the final, but we'll see." I'm getting an Ocean and def want the credit, but none of this looks promising.

 

[TT97]

This is a draft which is why I stated in my original post "I imagine they will include the possession language for the final, but we'll see." I'm getting an Ocean and def want the credit, but none of this looks promising.

If the language stays as written in the draft (which is how it is written in the Act), then the Ocean will qualify as long as you entered into a binding contract on or before 8/15/22 regardless of when you take possession. There is no possession language in the Act. There could be a dispute of what the IRS considers a "binding contract".

 

[macgirk]

If the language stays as written in the draft (which is how it is written in the Act), then the Ocean will qualify as long as you entered into a binding contract on or before 8/15/22 regardless of when you take possession. There is no possession language in the Act. There could be a dispute of what the IRS considers a "binding contract".

Correct, but it won't stay the same. The Secretary has already issued further guidance to the Act by adding the possession date language to the IRS website. That will be added to the final 8936 Form. I'd bet $7,500 on it. (but crossing my fingers that it doesn't)

 

[TESLAMIZE]

Correct, but it won't stay the same. The Secretary has already issued further guidance to the Act by adding the possession date language to the IRS website. That will be added to the final 8936 Form. I'd bet $7,500 on it. (but crossing my fingers that it doesn't)

The only page that has a date is the one with guidance for filing 2022 taxes. It also now no longer has the 5%. So, I dont take that page to be the end all be all. The form itself doesnt have an end date and neither does the law. Unless the form gets updated then the credit will apply. Its not semantics, MUST is simply not included on any actual form.

 

[TT97]

Correct, but it won't stay the same. The Secretary has already issued further guidance to the Act by adding the possession date language to the IRS website. That will be added to the final 8936 Form. I'd bet $7,500 on it. (but crossing my fingers that it doesn't)

The language on the IRS website pre-dates the draft instructions revision.

 

[Bastich]

If the language stays as written in the draft (which is how it is written in the Act), then the Ocean will qualify as long as you entered into a binding contract on or before 8/15/22 regardless of when you take possession. There is no possession language in the Act. There could be a dispute of what the IRS considers a "binding contract".

I've done some research on what constitutes a binding contract since I have ordered an Ultra with only a $250 deposit. Over the years I have had to research property deeds and seen the term "for the consideration of one dollar". This was done to satisfy one of the elements that makes a contract binding, namely that both parties receive consideration. There appears to be no limit on the amount. In fact, the term "for the consideration of one dollar" has largely been replaced by the term "good and sufficient consideration the receipt of which is hereby acknowledged" and doesn't even mention an amount. There are other elements to a binding contract, but this seems to be the source causing the most confusion.

In short, I'm taking the credit. I'll put it away somewhere in case the IRS ever comes after me so I can pay up quickly. However, I'll feel pretty good about hiring a lawyer to argue the point (as long as it doesn't cost more than $7,500).

What a [email protected]%#$!

Disclaimer: I am not a lawyer but I did stay at a Holiday Inn Express last night.