Clean vehicle credits can help car buyers pay less at the dealership
RS Tax Tip 2023-123, Nov. 15, 2023
Taxpayers who buy a qualifying new or used clean vehicle may be able to transfer their tax credits to the dealer in exchange for a financial benefit – such as a lower cost – starting Jan. 1, 2024.
Benefits of transferring the credit
Taxpayers can now claim tax credits for new and used clean vehicles they buy during the tax year and, starting Jan. 1, 2024, can transfer that credit to the dealership. This means that the taxpayer who is buying the vehicle can exchange their credit for a financial benefit such as reduced final cost. The financial benefit is equal to the amount of the credit, whether in cash, a partial payment or a down payment.
New information about the clean vehicle credit
The IRS recently issued proposed regulations, Revenue Procedure 2023-33 and frequently asked questions that cover:
- How taxpayers can transfer clean vehicle credits to eligible dealers.
- How dealers can register with IRS Energy Credits Online to receive advance payments.
- How dealers can lose their registration if they don’t comply with the program’s requirements.
- New details on the timing and submission of seller reports.
- Updated information for manufacturers on becoming qualified and how qualified manufacturers can submit monthly reports.
Dealers and sellers register by Dec. 1
Dealers and sellers of clean vehicles should register their organizations immediately using the Energy Credits Online tool. The IRS strongly urges sellers of clean vehicles to register by Dec. 1, 2023, to receive advance payments starting Jan. 1, 2024.
For updated clean vehicle credit frequently asked questions related to new, previously owned and qualified commercial clean vehicles, see Fact Sheet 2023-22PDF.
REF:Irs.gov
Take Money Out of Your IRA at Any Age Penalty-Free
Take Money Out of Your IRA at Any Age Penalty-Free You probably think you can’t take money out of your IRAs before age 59 1/2 unless you meet a narrow exception to the unpleasant 10 percent penalty on early distributions. But that’s not true. We have a variety of...
New IRS 199A Regulations Benefit Out-of-Favor Service Businesses
New IRS 199A Regulations Benefit Out-of-Favor Service Businesses If you operate an out-of-favor business (known in the law as a “specified service trade or business”) and your taxable income is more than $207,500 (single) or $415,000 (married, filing jointly), your...
Does Your Rental Qualify for a 199A Deduction?
Does Your Rental Qualify for a 199A Deduction? The IRS, in its new proposed Section 199A regulations, defines when a rental property qualifies for the 20 percent tax deduction under new tax code Section 199A. One part of the good news on this clarification is that it...
Help Employees Cover Medical Expenses with a QSEHRA
Help Employees Cover Medical Expenses with a QSEHRA If you are a small employer (fewer than 50 employees), you should consider the qualified small-employer health reimbursement account (QSEHRA) as a good way to help your employees with their medical expenses. If the...
How to Find Your Section 199A Deduction with Multiple Businesses
How to Find Your Section 199A Deduction with Multiple Businesses If at all possible, you want to qualify for the 20 percent tax deduction offered by new tax code Section 199A to proprietorships, partnerships, and S corporations (pass-through entities). Basic...
How Cost Segregation Can Turn Your Rental into a Cash Cow
How Cost Segregation Can Turn Your Rental into a Cash Cow Cost segregation breaks your real property into its components, some of which you can depreciate much faster than the typical 27.5 years for a residential rental or 39 years for nonresidential real estate....