Senate Proposal Would Eliminate Plug-In Vehicle Tax Credit

Merry Christmas to us.

From Charged EVs article:

http://chargedevs.com/newswire/senate-proposal-would-eliminate-plug-in-vehicle-tax-credit/" onclick="window.open(this.href);return false;

"Senate Finance Committee Chairman Max Baucus (D-Montana) has unveiled a draft package of proposals to streamline energy-related tax incentives. The package would repeal a number of current tax incentives, including those for plug-in vehicles."

Here's the Senate Finance Committee page about the proposal.

http://www.finance.senate.gov/newsroom/chairman/release/?id=3a90679c-f8d0-4cb6-b775-ca559f91ebb4" onclick="window.open(this.href);return false;

"Senator Baucus also called for additional feedback from members of Congress, key stakeholders and the general public on the discussion draft. Feedback on the discussion draft is requested by January 31, 2014 and comments can be sent to: [email protected]."

This looks like something we need to get busy and comment on.

Thoughts about the likelihood of this package getting past the Senate and getting a signature from the President?

(Note that Baucus has been nominated as the new ambassador to China, so he'll likely be out of the Senate soon.)

Senator Ron Wyden [D-Oregon] is set to be the new Finance Chairman. I think the chances that he'd support ending the credit are between slim and none. And much closer to none.

They need to change it from a tax credit to an actual rebate if they truly want it to be effective... The chance of that happening during the current administration is absolutely zero however...

oakwcj said:

Senator Ron Wyden [D-Oregon] is set to be the new Finance Chairman. I think the chances that he'd support ending the credit are between slim and none. And much closer to none.

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The problem with legislation that claims to be "technology neutral" is that, at least in this case, it would serve to promote incremental improvements while neglecting the potential for disruptive change.

EVs are merely a drop in the bucket right now. Provided EV technology continues to be developed at the current rate, however, I expect that EVs will disrupt the automotive industry in not too many years. With larger batteries and more charging infrastructure to address the problem of limited driving range, coupled with continued cost reductions, EVs will come to offer a compelling value proposition that's recognizable even to those who care little about the societal and environmental benefits. And that will radically change our transportation landscape for the better.

I think this sort of disruption will happen sooner or later even without tax incentives, but sooner would be better for our country and for the world.

TomT said:

oakwcj said:

Senator Ron Wyden [D-Oregon] is set to be the new Finance Chairman. I think the chances that he'd support ending the credit are between slim and none. And much closer to none.

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They need to change it from a tax credit to an actual rebate if they truly want it to be effective...

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Note that either increasing/decreasing/ending the credit or changing it to a rebate requires passing a law through both houses of Congress and getting it signed by the President. I would judge that the chances of clearing all three hurdles for any of those things in 2014 are nil.

Frankly, given Nissan's policy of treating the credit as effectively a rebate for leases, I'm happy to keep the law the way it is.

Ray

TomT said:

They need to change it from a tax credit to an actual rebate if they truly want it to be effective

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You would think an actual cash rebate would be more effective than a tax credit. However, Tesla doesn't seem to care one way or another.

On their .ca site, they mention that you may qualify for tax credits if you purchase a Tesla in certain provinces. However, the three provinces in question all offer cash rebates which can be applied before you pay. Income taxes have nothing to do with it. Apparently this has been pointed out to them several times, but they don't bother to correct the error. I emailed them about it and got no response.

Sorry, duplicate post.

TomT said:

They need to change it from a tax credit to an actual rebate if they truly want it to be effective... The chance of that happening during the current administration is absolutely zero however...

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NO WAY!
Either credit or rebate, I end up paying someone else's taxes. I feel a bit better if he pays at least something. (Yes, I got my credit, and another due for 2013.)

good riddance to Baucus. he is the guy who invited the former health insurance lobbyist to run his staff, write the ACA and kill the public option.
China is not far enough away for someone as feckless as that.

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Oh yeah; healthcare was such a dream in this country prior to the ACA... Our healthcare system is the scorn and ridicule of most of the developed nations, and with good reason...

thankyouOB said:

good riddance to Baucus. he is the guy who invited the former health insurance lobbyist to run his staff, write the ACA and kill the public option.
China is not far enough away for someone as feckless as that.

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I'm sorry Tom but you are incorrect. In 2009 I bought a new home and I got $8500 tax credit from Obama. I only owed $2600 on my taxes that year. And so the Federal Gov sent me a check for $5900.00

Same thing applies with the EV Tax Credit. If you don't owe anything you will get a check for $7500.00

TomT said:

You are missing the point.

If I manage my taxes well, I'll owe nothing at tax time even though I may have actually had a large tax liability and paid many tens of thousands in taxes. Thus, the tax credit would be worthless to me...

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TomT said:

If I manage my taxes well, I'll owe nothing at tax time even though I may have actually had a large tax liability and paid many tens of thousands in taxes. Thus, the tax credit would be worthless to me...

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I think you are incorrect, Tom. If you have paid in $7,500 during the year, and you claim the tax credit, it comes back to you as a refund.

I also manage, and pay throughout the year, with a zero or very little owed at tax time. BUT, I still get the credit (as a refund), because my total tax obligation for the year was in excess of $7,500.

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uh, no.
if you have a tax liability, whether you manage it well so you dont pay more on april 15, you do get the credit.
and so you get a refund.
but you need 7.5k in liability.

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Never mind.

TomT said:

And you have to steer clear of the AMT...

thankyouOB said:

if you have a tax liability, whether you manage it well so you dont pay more on april 15, you do get the credit.
and so you get a refund. but you need 7.5k in liability.

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I could be wrong, but I believe that the $7500 credit is not limited by the AMT, but the home charging equipment credit is.

Boomer23 said:

TomT said:

And you have to steer clear of the AMT...

thankyouOB said:

if you have a tax liability, whether you manage it well so you dont pay more on april 15, you do get the credit.
and so you get a refund. but you need 7.5k in liability.

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I could be wrong, but I believe that the $7500 credit is not limited by the AMT, but the home charging equipment credit is.

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As I recall the problem, it was if you tried to take both the EV credit and charging equipment credit in the same taxable year, the AMT computation made the charging equipment credit very difficult to get. Even though the AMT did not actually apply. No effect on the EV credit.