Federal Reserve Revises EV Tax Credit Rules to Allow More Vehicles to Be Called SUVs

• The U.S. Treasury Department today announced a new vehicle classification that will allow more vehicles to qualify as SUVs and receive the newly updated EV tax credit.
• The new rule is cadillac lyric, Ford Mustang Mach E, Tesla Model Yand others are SUVs and therefore qualify under the higher $80,000 MSRP limit.
• The rule change is retroactive, so anyone who purchased a vehicle after January 1, 2023 and is currently eligible can claim the credit.

There are many more changes to the complex federal tax credit rules that include EV. With the latest update, more models are now classified as SUVs and the maximum suggested retail price has been increased from $55,000 used for automobiles to $80,000. Pickup trucks and vans also fall into this category.

it’s how they look at it

The U.S. Treasury announced today A new standard for vehicle classification, implemented as part of the Inflation Reduction Act (IRA). Using criteria similar to those used by the Environmental Protection Agency (EPA) and Department of Energy (DOE) to determine vehicle size and class, the IRA classifies these vehicles to Treasury Secretary Janet Yellen. decided how.

The Treasury Department, which used to classify vehicles using the EPA’s CAFE standards, will now switch to a system based on fuel efficiency labeling standards. The old rules will remain in effect until the proposed rules become official (we don’t know when that will be), but Treasury said if you buy an EV in 2023, you were previously ineligible. but said he is now eligible. Claim credit. Both Ford and Tesla recently announced price cuts for their vehicles.

The IRA was signed into law in August, but it was not until the end of December that the Internal Revenue Service defined some terms of the law. As part of today’s announcement, the Treasury Department reminded everyone that he will further clarify guidance on critical minerals and batteries in March.

This affects both automakers and buyers

Ford, GM and Tesla all backed previous rule changes. GM said car and driver In a statement, the tax credit “has been proven to facilitate the adoption of electric vehicles,” and the Treasury’s “alignment” with CAFE standards will help “regulators and manufacturers as well as consumers. It will also provide the clarity that is needed for business owners and dealers.”

At Ford, Chief Government Affairs Officer Chris Smith said. CDs: “We recognize that the Treasury Department has a huge task before them in implementing the Inflation Control Act. We sincerely appreciate their care and efforts to ensure more customers have access to the clean automobile tax credit under the law. ”