Gary Zhou 
- 🚗 Many Tesla vehicles qualify for IRA tax credits for EVs, but recent updates exclude two Model 3 variants and the Cybertruck.
- 💰 As of January 1, 2023, the Tesla Model 3 Rear-Wheel Drive (RWD) and Model 3 Long Range (LR) no longer qualify for the full $7,500 EV tax credits under the IRA.
- 🌐 Exclusion may be related to recent IRS rules about foreign entities of concern (FEOC), impacting vehicles with components from nations like China, Russia, and North Korea.
- 🏎️ IRS requirements set MSRP thresholds for EVs to qualify for IRA tax credits, with the Model S All-Wheel Drive (AWD) and Model S Plaid missing the mark.
- 🤔 It’s uncertain if the Cybertruck AWD and RWD versions will be added to the IRA tax credits list, as the launch was late last year.
- 💵 The Cybertruck AWD is close to the MSRP qualification, priced at $79,990, while the RWD variant is expected in 2025.
- 📉 Customers need to consider optional equipment attached to the vehicle for IRA’s price qualification.
- 📆 The inclusion of Cybertruck variants in the IRA’s list may take time due to the recent market launch.
- ✉️ Tesla informed customers about changes to IRA tax credit eligibility, stemming from the Biden Administration’s proposed IRA guidance.
In the ever-evolving landscape of electric vehicles (EVs) and tax incentives, Tesla enthusiasts and potential buyers find themselves facing new updates and exclusions under the Inflation Reduction Act (IRA). The latest changes, impacting two Model 3 variants and the Cybertruck, require a closer look to understand their implications fully.
The Tesla Lineup and IRA Tax Credits
1. Many Qualify, but Some Left Out 🚗
Recent updates to Tesla’s IRA tax credit eligibility have left some enthusiasts puzzled. While many Tesla vehicles continue to qualify for IRA tax credits, specifically the incentives designed to promote the adoption of electric vehicles, it’s noteworthy that two Model 3 variants and the Cybertruck are currently excluded.
2. Model 3 Variants: No Longer Full $7,500 Credit 💰
As of January 1, 2023, Tesla’s Model 3 Rear-Wheel Drive (RWD) and Model 3 Long Range (LR) variants no longer qualify for the full $7,500 EV tax credits under the IRA. This change, communicated by Tesla following the Biden Administration’s proposed guidance on IRA, raises questions about the specific reasons for their exclusion.
3. FEOC and Exclusion from Tax Credits 🌐
The exclusion of certain Tesla models, especially the Model 3 variants, could be linked to recent IRS rules concerning foreign entities of concern (FEOC). The presence of components sourced from nations such as China, Russia, and North Korea may impact eligibility for IRA tax credits.
The Challenge with MSRP and Model S
4. MSRP Requirements and Model S Exclusion 🏎️
IRS requirements set Manufacturer Suggested Retail Price (MSRP) thresholds for EVs to qualify for IRA tax credits. Unfortunately, both the Model S All-Wheel Drive (AWD) and Model S Plaid miss the mark. This exclusion prompts a reevaluation of the pricing strategy for these high-end Tesla models.
The Uncertain Fate of the Cybertruck
5. Cybertruck: Awaiting Inclusion 🤔
The much-anticipated Cybertruck, launched late last year, brings its own set of uncertainties. The All-Wheel Drive (AWD) version is in close proximity to the MSRP qualification, priced at $79,990. However, the Rear-Wheel Drive (RWD) variant, expected in 2025, poses an additional layer of complexity.
6. Optional Equipment Considerations 💵
Customers eyeing IRA tax credits for their Tesla purchases must carefully consider optional equipment physically attached to the vehicle. These add-ons can influence the total purchase price and, subsequently, the eligibility for IRA tax incentives.
7. Timing Challenges for Cybertruck Inclusion 📆
While the Cybertruck AWD is on the cusp of meeting MSRP requirements, the process of inclusion in the IRA’s tax credits list may take time. The recent market launch adds a layer of complexity to the evaluation process.
Proactive Communication from Tesla
8. Biden Administration’s Influence and Communication ✉️
Tesla’s proactive approach to informing customers about changes to IRA tax credit eligibility is commendable. Stemming from the Biden Administration’s proposed IRA guidance, this communication ensures transparency and helps buyers navigate the evolving landscape of EV incentives.
