At the end of each quarter immediately before a drop in Tesla’s tax credit, there are always rumors that an extension for the credit may be right around the corner. So far, those rumors have never panned out and I would typically recommend buyers not wait and potentially gamble away their current tax credit on a potential future one.
The rumors this time, however, seem far more concrete than anything we have seen before. Here is what we know!
• There is currently a deal in the works between House Democrats and some Senate Republicans, including powerful Senate Finance Chairman Chuck Grassley, to place an electric vehicle tax credit extension into the FY 2020 budget in exchange for a retroactive tax incentive on biodiesel.
• The FY 2020 budget is expected to be voted on in the House as early as today, so it is likely that we will know the outcome quite soon.
• The tax extension would likely bring the federal tax credit back up from $1,850 to a full $7,000. The $7,000 tax credit would stay in play until a manufacturer hits 600,000 U.S. vehicle deliveries. It is unclear whether Tesla would start back from the 200,000 delivery mark or if it would work off of current deliveries. In either case, Tesla will have at least one to two quarters of another full $7,000 tax credit.
As of 12:30 PM, Bloomberg is reporting that the White House has begun last minute lobbying in an effort to stop the electric vehicle subsidies.
This is a fluid situation that can change at any time and, as of right now, it is a toss-up as to whether the extension will make it through. Time will tell!
We find it’s much more accurate to determine the value of a Tesla based on its features and build date rather than the model year. Please feel free to contact us at firstname.lastname@example.org for an up-to-date NPV (net present value) on your Tesla.