Researchers have found consumers overwhelmingly prefer an immediate rebate, rather than a tax credit.
Beginning Jan. 1, 2024, people who buy qualifying new and used “clean” vehicles will be able to effectively receive federal rebates when they buy it, rather than waiting for a rebate on the following year’s tax return.
The U.S. Department of the Treasury released guidance Oct. 6 on how customers will be able to transfer their Inflation Reduction Act (IRA) clean vehicle credits---up to $7,500 for a new vehicle and up to $4,000 for used---to the dealership, which will then credit it to the purchase price.
Researchers have found consumers overwhelmingly prefer an immediate rebate.
“President Biden’s Investing in America agenda is focused on lowering transportation costs for consumers and giving American car companies the tools to lead the market,” said Laurel Blatchford, chief implementation officer for the IRA. “For the first time, the Inflation Reduction Act allows consumers to reduce the up-front cost of a clean vehicle, expanding consumer choices and helping car dealers expand their businesses. The IRS has focused on streamlining this process for car dealers as part of its commitment to improving service and helping taxpayers claim the credits they are eligible for.”
Later in October, dealers will be able to register via IRS Energy Credits Online, a new website. In January, they will use the website to submit clean vehicle sales information to receive payment for customers’ transferred credits. Dealers must register with Energy Credits Online for customers to be eligible to transfer their credits.
Customers must meet income requirements to be eligible to transfer the credit.