Finally! Feds Revise EV Tax Credit Rules For More Vehicles To Be Called SUVs
The U.S. Treasury Department recently declared new categories for vehicles which will enable more automobiles to fit the criteria of being an SUV and claim the revised EV tax credits.
The regulations now class the Cadillac Lyriq, Ford Mustang Mach-E, Tesla Model Y and others to be considered as SUVs, and thus are eligible for the higher maximum sale price of $80,000.
The rules shift is effective from the beginning of the year, so those who bought a vehicle from January 1, 2023 that now meets the criteria can get the rebate.
Further adjustments are expected to the complex federal tax credit regulations concerning EVs. The most recent amendment notably allows more models to be labeled as SUVs, increasing the MSRP cap from the $55,000 limit used for cars to a maximum of $80,000—this also applies to pickup trucks and vans.
The Treasury Department declared fresh regulations for vehicle classifications today, which were put in place as a result of the Inflation Reduction Act (IRA). The IRA gave the Secretary of the Treasury the authority to decide the parameters for classifying these vehicles, utilizing criteria similar to those applied by the Environmental Protection Agency and the Department of Energy to determine cars' size and class.
The Treasury Department had been labeling automobiles according to the Environmental Protection Agency's CAFE rules, but will move to a framework based on the Fuel Economy Labeling criterion. The old regulations will remain until the new regulations are confirmed, though when that will happen is uncertain.
The Treasury Department has said that if someone buys an electric car in 2023 that didn't meet the criteria before, but does now, they will still be able to acquire the tax credit. Both Ford and Tesla recently reduced their vehicle prices, allowing them to be eligible for the credit even at higher costs.
The IRA took until December to define the terms in the new tax law, which clarified that certain EVs would qualify for the tax rebate. The Treasury Department will provide further guidance on critical minerals and batteries in March.
2023 Tesla Model Y: What You Need to Know
| Year | Body | Trim | Range | Price |
|---|---|---|---|---|
| 2023 | Hatchback, SUV | Rear-Wheel Drive | 260 | $43,990 |
| 2023 | Hatchback, SUV | Long Range | 330 | $48,990 |
| 2023 | Hatchback, SUV | Performance | 303 | $52,490 |
