I’m updating this article I wrote 6 months ago which informed readers about the new $4,000 tax credit for used electric cars under $25,000 and predicted that used Tesla prices would be driven into that range by the $7,500 federal tax credit and Tesla’s price cuts. As predicted, new and used Tesla prices have dropped, but unfortunately, Tesla has “forgotten” to file the paperwork with the IRS that would provide buyers of its used vehicles the ability to file for the $4,000 tax credit. Hopefully the publicity from this article will help encourage Tesla to do the paperwork so that people can claim this benefit.
IRS Website Confirms No Tesla Here
Screenshot from IRS website showing auto manufacturers whose EVs qualify for the used electric car tax credit.
As you can see in the screenshot above, Tesla is missing on the list of brands available for the used electric vehicle tax credit. You can check the IRS website here, and the qualified vehicle list is here — in case you read this article later and want to see if Tesla has submitted the paperwork and it has been accepted.
Older Tesla Model S & Model 3 Cars Are Starting To Sell Below $25,000
As you can see in the picture above, the average older Model S is selling at just over $25,000, which means about half are selling above and half are selling below. An you can see, the trend is down, so more and more Model S buyers will be missing out of the $4,000 tax credit if Tesla doesn’t file the paperwork before they file their taxes next year.
As you can see in the picture above, the average price of older Model 3 sales is still about $30,000, which makes no sense, since the new Model 3 inventory models are available for just over $38,000, which brings the net cost down to just over $30,000 for those eligible for the credit. I expect used Model 3 prices to continue to soften and many to be available for under $25,000 within the next few months.
As you can see in the picture above, 388 Model 3 cars are available in the US right now for under $30,000, with a handful (usually with high mileage) available under $25,000 with a clean title. Once again, the buyers will miss out on the tax credit if Tesla doesn’t file for it.
Conclusion
Tesla was very good at doing its part to ensure its customers buying new Tesla vehicles got the $7,500 credit if they were eligible, but interestingly, it seems the company is not as interested in going after the $4,000 credit for used vehicles. I’ve even noticed when the price of the older used Model 3 cars on Tesla’s site get close to $25,000, Tesla adds either advanced Autopilot or Full Self Driving to the car to increase the price a bit. I also realize that the income limits for this credit ($75,000 for single filers/$150,000 for married filing jointly) exclude most of Tesla’s traditional upper middle class clients, but Tesla must realize that, to accomplish its mission, it has to drive ownership into middle-class and lower-middle-class households.
If you want to take advantage of my Tesla referral link to get Reward Credits, here’s the code: https://ts.la/paul92237 — but as I have said before, if another owner helped you more, please use their link instead of mine. If you want to learn more about Tesla’s new referral program, Chris Boylan has written an excellent article on it.
Disclosure: I am a shareholder in Tesla [TSLA], BYD [BYDDY], Nio [NIO], XPeng [XPEV], Hertz [HTZ], and several ARK ETFs. But I offer no investment advice of any sort here.
Sign up for daily news updates from CleanTechnica on email. Or follow us on Google News!
Have a tip for CleanTechnica, want to advertise, or want to suggest a guest for our CleanTech Talk podcast? Contact us here.
Former Tesla Battery Expert Leading Lyten Into New Lithium-Sulfur Battery Era — Podcast:
I don’t like paywalls. You don’t like paywalls. Who likes paywalls? Here at CleanTechnica, we implemented a limited paywall for a while, but it always felt wrong — and it was always tough to decide what we should put behind there. In theory, your most exclusive and best content goes behind a paywall. But then fewer people read it! We just don’t like paywalls, and so we’ve decided to ditch ours. Unfortunately, the media business is still a tough, cut-throat business with tiny margins. It’s a never-ending Olympic challenge to stay above water or even perhaps — gasp — grow. So …
If you like what we do and want to support us, please chip in a bit monthly via PayPal or Patreon to help our team do what we do! Thank you!
Advertisement