EV tax credit changes mean low-income buyers can soon get full $7,500
The IRS released new guidance on the EV tax credit today, and the changes mean that starting next year, low- and middle-income buyers will be able to get the full $7,500 credit even if they don’t have enough tax liability.
The Inflation Reduction Act included big changes to the EV tax credit, and those changes were set to roll out over the course of the months and years after it passed.
One of those changes has to do with making the tax credit available upfront at the point of sale. This means that, instead of having to file for the credit on your taxes the year after you purchase an EV, you just get a cheaper car upfront.
One other issue with the tax credit was that it wasn’t available to customers who didn’t have enough tax liability to claim it. The credit is not “refundable” and can’t be rolled forward, so if you don’t make more than about $66,000 (absent other credits), you won’t have enough tax liability to reduce and therefore you leave some of the $7,500 on the table.
But the new changes announced today fix that, such that buyers of lower income levels will be able to get the full $7,500 credit, upfront at the point of sale.
The relevant part of the law is the new “transferability” provision that allows a buyer to transfer the EV tax credit to the dealership they are purchasing the car from. The dealer then passes the savings on to the buyer, and is reimbursed by the government with an advance payment of the tax credit.
It’s covered in the fact sheet the IRS released today, under Topic H, Q4
Q4: What if a buyer has insufficient tax liability to fully use a transferred credit? (added October 6, 2023)
A4. The amount of the credit that the electing taxpayer elects to transfer to the eligible entity may exceed the electing taxpayer’s regular tax liability for the taxable year in which the sale occurs, and the excess, if any, is not subject to recapture from the dealer or the buyer.
Here, “recapture” refers to the ability of the IRS to come seek you out if they decide that you’ve improperly filed for the credit. This question states that the credit is not subject to recapture, even if the buyer ends up having too little tax liability to otherwise benefit from it (and dealers don’t have to worry about it either, per Topic H, Q19).
This change does not remove the income cap present in the IRA law, which restricts the credit for taxpayers who make over $150,000 single/$225,000 head-of-household/$300,000 married. So high-income people still cannot claim the new credit, but low and middle-income people can.
The change goes into effect on January 1, 2024, so any EV purchased after that date from a registered car dealer will be able to take advantage of these transferability provisions.
Electrek’s Take
While we already covered the tax credit changes this morning, I wanted to write this article to specifically address what has been a big sticking point with the credit ever since its original inception back in 2008. President Obama even mentioned it in a State of the Union and made it a policy goal of his to make the credit available at point of sale.
The way the credit was previously designed was regressive, meaning that higher-income people were more able to benefit from it than lower-income people. This is something that should generally be avoided when creating policy.
It also meant that buyers might have to finance the additional $7,500, paying more interest and higher monthly payments for the lifetime of the car. In short, it just made electric cars less attainable to lower-income people, which is a shame, since they’re the ones who could benefit most from cheaper running costs and cleaner air in lower-income communities that tend to be more polluted.
While lower-income buyers don’t typically buy new cars, it’s certainly conceivable that someone making around the national average income ($59,000 less than the approximately $66,000 required for $7,500 of tax liability) might be able to buy a new Nissan Leaf at $28,000 base MSRP or upcoming Volvo EX30 at $35,000. Or if they’re lucky, maybe they can snag a Chevy Bolt that’s still in inventory at the beginning of next year, despite that car’s upcoming discontinuation in December.
Some might even be able to stretch for the new lower-priced Model 3 at $39,000, assuming Tesla prices or tax credit availability don’t change by next year, which they probably will. Although we certainly do not recommend that anyone stretch beyond their means to buy a new car just because it’s a Tesla – be sure to think about how this purchase would affect your finances, and if you still can’t afford a new car, you can always go with used.
Which brings to mind that, for low-income customers, this change should also apply to the used electric vehicle credit as well. This is available in a lower amount ($4,000) and has additional limitations on the vehicle purchase price. (The used EV must be under $25,000, and income caps are lower than on the new car credit)
There are also myriad other reasons that a buyer might be in a situation where they temporarily have lower tax liability than usual, or have access to other credits or refunds that lower their liability in a particular tax year, and might have otherwise jeopardized their ability to take the full EV tax credit. This change gets around many of those situations and should make it much easier for everyone to get the credit.
This is why when I originally wrote about the IRA tax credit changes, I used the headline “Senate improves EV tax credit.” While some of the changes added complexity, especially in the intervening year and a half as certain provisions have rolled out, overall it means that more cars will get the credit (by removing the cap of 200,000 per manufacturer), and the credit will be much easier to attain for those who seek it due to these transferability provisions.
Between this and the ability to bypass most requirements by leasing, EV tax credit availability is better than it’s ever been, and that’s great news for consumers, for EV makers, and for the environment.
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Trump’s crypto-frenzied inauguration weekend makes first family billions of dollars richer
Snoop Dogg was the lead act at the first-ever Crypto Inaugural Ball held in Washington on Friday evening
MacKenzie Sigalos
As the crypto industry celebrates the arrival of a new administration in Washington, D.C., nobody is taking quicker advantage of the coming changes than the person leading the charge: President Donald J. Trump.
On Friday night, crypto A-listers rubbed elbows with political elites and members of Trump’s inner circle at the Crypto Ball, held at the opulent Mellon Auditorium, just down the street from the White House.
Meanwhile, Trump’s net worth was about to explode from an asset that, up to that point, didn’t exist. The same night of the party, the incoming president launched $TRUMP, a meme coin built on the Solana platform. Its market cap over the weekend climbed past $14 billion. Like with other meme coins, there’s no underlying product. Trump told his followers in a social media post, “It’s time to celebrate everything we stand for: WINNING!”
The website for $TRUMP says 80% of the coins are held by the Trump Organization and affiliates.
Inside the Crypto Ball were some of the leaders of the platforms allowing ordinary investors to buy into Trump’s newest project. They included Coinbase CEO Brian Armstrong and Kraken co-founder Jesse Powell.
Trump wasn’t done after one token.
On Sunday came the introduction of $MELANIA, named after the first lady. The coin quickly spiked more than 40%, surpassing $2 billion in value. Both the Trump and Melania coins have dropped significantly from their highs.
Then there’s World Liberty Financial, a decentralized finance project endorsed by the Trump family, which hiked its token price from 1.5 cents to 5 cents and released an additional 5 billion tokens for sale. The project, initially launched in September, has raised more than $300 million in total sales so far, according to blockchain firm Arkham Intelligence.
The Trump family gets 75% of World Liberty’s crypto coin revenue, according to the project’s founding document. On-chain data shows millions of dollars worth of token transfers to Coinbase’s institutional custody provider.
“We’re making routine movements of our crypto holdings as part of regular treasury management, payment of fees and expenses, and to address working capital requirements,” World Liberty said in a statement.
CNBC reached out to Donald and Melania Trump earlier Monday and didn’t receive a response.
‘Reign of terror’
In the period of 48 hours, the Trump family’s net worth surged by billions of dollars, based on holdings of its just-launched digital assets, underscoring the unregulated nature of cryptocurrencies and the president’s ability to use his fame, power and newfound partnership with the nascent industry to enrich himself, his family and his allies at the flip of a switch.
Broader market enthusiasm has been expressed in the price of bitcoin, which surged to an all-time high hours before the inauguration to nearly $110,000. Crypto industry leaders and investors emerged as some of Trump’s biggest supporters in the campaign in an effort to influence future policies and to ease the restrictive regulations imposed during the Biden administration. In July, Trump delivered the keynote at the Bitcoin Conference in Nashville, Tennessee.
Digital asset entrepreneurs, politicians, and members of Trump’s inner circle hit the red carpet at the first-ever Crypto Inaugural Ball in Washington on Friday.
MacKenzie Sigalos
“The reign of terror against crypto is over,” David Sacks, a prominent Silicon Valley investor and the new White House AI and crypto czar, told the packed D.C. ballroom on Friday night. His comments were met with applause that echoed beneath the Mellon Auditorium’s soaring columns.
Sacks, an earlier Trump critic who said the events of Jan. 6, 2021, had “disqualified” him from being a candidate at the national level, threw his weight behind Trump last year. He hosted a high-profile fundraiser at his San Francisco mansion in June and regularly promoted the Republican candidate on the popular “All-In” podcast.
“The beginning of innovation in America for crypto has just begun,” Sacks added on Friday.
On X, formerly Twitter, conversations were lighting up about the new $TRUMP coin. There was plenty of skepticism from those in and around the industry.
“Trump needs to fire his crypto advisors, from top to bottom and replace with people who know what they are doing,” wrote Gabor Gurbacs, founder of digital asset firm Pointsville, in a post on X. “The memecoins cost the US, the presidency and his family a lot of credibility and the consequences haven’t even started.”
Mark Cuban, the billionaire former tech entrepreneur and part owner of the Dallas Mavericks, commented on the apparent lawlessness of it all. Cuban, a longtime independent who became a vocal supporter of Democratic nominee Kamala Harris, said the coins are particularly harmful to the crypto industry in its effort to prove its legitimacy.
“Hello every scam targeted at everyone and anyone who has no clue about crypto,” he wrote.
But at the pre-inauguration party, Trump’s new coin wasn’t much of a topic. Rather, the chatter centered on the broader implications of Trump’s policies, which promised to dismantle years of regulatory gridlock in the Biden administration.
“Two years ago, everyone thought crypto was dead,” said one attendee who asked not to be named in order to speak candidly on the topic. “A year ago, we were begging for help, and this weekend, we’re on top of the world.”
Crypto firms made substantial contributions to Trump’s inaugural fund, signaling their enthusiasm. Ripple donated $5 million in digital tokens, while Coinbase, Kraken, and Circle each gave $1 million. Online brokerage Robinhood contributed $2 million.
Inside the first-ever Crypto Ball at the Mellon Auditorium in Washington ahead of the Donald Trump Inauguration.
MacKenzie Sigalos
Coinbase and Kraken have both been battling the SEC in court. Robinhood received a Wells Notice in May related to its U.S. crypto business, which is typically one of the final steps before the SEC issues formal charges. Ripple has been in a years-long legal fight with SEC and outgoing Chairman Gary Gensler.
“The question now is, what do we do with this momentum?” said Ripple Chief Legal Officer Stuart Alderoty, who attended the Friday night festivities. “How do we take that momentum and move forward to really create the promise that I think this new administration has of making the U.S. the crypto capital of the world?”
Alderoty wants to see a coalition formed to discuss unified policy priorities.
“Ultimately, Congress will own the policy, and we can’t dictate to Congress what the policy should be,” Alderoty said. “It would be great if, ahead of that, in the face of the most crypto-friendly Congress we’ve ever had, there could be some alignment on what the priorities are,” Alderoty said, noting that the industry has splintered in the past when proposals have been introduced.
Inside the Crypto Ball
There was a hefty dose of lawmaker support at the party, all from the Republican side of the aisle. House Speaker Mike Johnson was there, along with Senators Marsha Blackburn, Ted Cruz and Cynthia Lummis. Former House members French Hill and Patrick McHenry arrived to show their support.
Cleanspark CEO Zach Bradford, who has been meeting with Trump in private roundtables to discuss bitcoin mining, said he spoke with Howard Lutnick, Trump’s pick to be Secretary of Commerce, at the event.
“We talked about bitcoin mining and how bitcoin, but also bitcoin mining, can be a central point of commerce,” Bradford told CNBC.
Bradford said he emphasized to Lutnick the potential for bitcoin mining to be a significant economic driver.
“It’s a positive revenue generator from a net production perspective,” Bradford said. “But we’re also contributing significant tax revenues for the states where we operate.”
Bradford said Lutnick is “excited about it,” describing him as “somebody that gets bitcoin.”
Scott Bessent, likely to be the next Treasury secretary, made his way through the main floor of the ballroom and took photos with attendees.
Koh Harada, COO of Aleo, a privacy-focused blockchain, said Bessent was “pretty coy about things, but the fact that he was even there was very interesting.”
Aleo, which has raised over $200 million from investors including SoftBank and Andreessen Horowitz, chose to establish in the U.S. while many rivals opted to launch from offshore jurisdictions like the Cayman Islands as a shield from various regulations.
“We didn’t set up shop in the U.S. on a whim,” Harada said. In talking to a mix of legal and compliance experts, the company realized that “America is the best fertilizer for tech — period,” he said.
Aleo, which combines privacy-focused functionality with smart contract capabilities, has become a go-to resource for other startups looking to return to the U.S., Harada added. The company picked Wyoming, a state known for its crypto-friendly policies.
“Wyoming stood out as the most welcoming state for crypto,” Harada said. “They’ve created forward-thinking policies and are even establishing blockchain research centers at the University of Wyoming.”
It was the side conversations in the MAGA Inc. VIP Reception greenroom where the most significant exchanges of the evening unfolded.
MacKenzie Sigalos
Also in attendance on Friday was MicroStrategy founder Michael Saylor, wearing his trademark orange bow tie, a nod to bitcoin’s iconic color. Ripple CEO Brad Garlinghouse and top execs at Coinbase, including global policy head Faryar Shirzad, mingled with guests.
The Winklevoss twins chatted in a group that included Chris Dixon of Andreessen Horowitz and his colleague, Sriram Krishnan, who recently left his role as a general partner at the firm to join Sacks’ task force. Bo Hines, Trump’s choice to lead the Presidential Council of Advisers for Digital Assets, was also present. He’ll report directly to Sacks.
While Snoop Dogg performed in the main ballroom, venture capitalist Katie Haun was engrossed in conversation with Galaxy Digital’s Mike Novogratz. Other musical guests Rick Ross and Soulja Boy, who was charged by the SEC in 2023 for illegally promoting a crypto token without disclosing he was paid, kept the larger crowd entertained.
Guests were issued wristbands based on status. Black wristbands signified general admission and gold allowed entry to a VIP balcony. White bands granted the most exclusive perks. General admission cost $2,500, and some sponsors paid $1 million for access to the greenroom on the ground floor tucked behind the stage in the main ballroom.
Tightly guarded by security, Donald Trump Jr. donned custom MAGA buttons on his shirt as he swiftly made his way into the innermost chamber of the VIP section, a room barricaded by a rotating bouncer and only allowing in certain guests. Along with Sacks, and Speaker Johnson, he could be seen conversing with Fred Thiel, CEO of mining company MARA Holdings.
Thiel shared details of a blockchain initiative his company had launched earlier that day with Johnson, an effort designed to symbolize the intersection of crypto and politics.
“We minted a block on the blockchain with a portrait of President Trump, created entirely from transactions,” Thiel said.
Speaker of the House, Mike Johnson, with Mara CEO Fred Thiel. Johnson seen texting President Donald Trump a photo of the Trump47 bitcoin block minted by Mara earlier that day.
Fred Thiel
The so-called Trump47 block embedded Trump’s headshot into the Bitcoin blockchain, creating a lasting digital tribute to the president.
“We released it Friday morning, and it went viral,” Thiel said. He added that Johnson “was so impressed” that he texted Trump a picture of it.
Tracy Hoyos-López, a former California prosecutor and one of the people credited with turning Trump pro-bitcoin, was also at the event.
“Don’t mess with crypto,” Hoyos-López, who helped to plan the evening’s celebration, told CNBC while Snoop Dogg was performing his live set. “Our event is a symbol of who we are in the world.”
WATCH: Bitcoin surges past $100,000
Environment
Hyundai launches new Creta Electric SUV in India, starting at just $20,000: Meet the new EV
Hyundai officially launched its newest electric vehicle, the Creta Electric, in India. It starts at just over $20,000 and has a range of nearly 300 miles. The Creta EV is Hyundai’s first electric SUV made in the country. Here’s a look at the new model.
Hyundai reveals Creta EV prices start at $20,000
Since it hit the market in 2015, the Hyundai Creta has been a massive success for the company in India. The SUV led Hyundai India to another record sales year, with 186,919 models sold in 2024.
Hyundai sold a record 605,433 vehicles in India last year, up from 602,111 in 2023. Including exports, Hyundai India sold 764,119 vehicles in 2024.
“Achieving highest ever domestic sales three years in a row, reflects customers’ preference for brand Hyundai as their trusted smart mobility solutions provider,” Hyundai India’s COO, Mr Tarun Garg, said earlier this month.
The Creta was the company’s main growth driver, accounting for over 30% of sales. With its highest yearly sales since launching, “CRETA continued to strengthen HMIL’s position as an SUV leader, helping HMIL accomplish its highest-ever domestic SUV contribution of 67.6% in CY 2024,” he added.
Now, Hyundai’s top-selling SUV in India is going electric. Earlier this month, Hyundai unveiled the electric SUV for the first time. On Friday, at the Bharat Mobility Global Expo, Hyundai launched the Creta EV, which starts at just Rs 17.99 Lakh, or just over $20,000.
It’s available in four trims: Executive, Smart, Premium, and Excellence. The most expensive Excellence trim starts at Rs 23.50 lakh, or about $27,200. In comparison, the gas-powered SUV starts at around $12,800 (Rs 10.99 LAkh).
Buyers can choose from two battery packs, 42 kWh and 51.4 kWh, offering a driving range of 390 km (242 miles) and 473 km (294 miles) in India.
Hyundai is confident that the Creta EV “will further expand the appeal of this Undisputed, Ultimate SUV,” Mr Tarun Garg said.
Hyundai plans to launch five new EVs in India by 2030, including the new Creta. To meet the growing demand in the region, it’s also planning to launch three-wheel electric cars.
Although Hyundai is not launching the Creta EV in the US, the company is introducing a series of new and upgraded electric models this year. The 2025 IONIQ 5 now features more driving range and comes with an NACS port for charging at Tesla Superchargers. Meanwhile, Hyundai’s first three-row electric SUV, the EV9, will arrive shortly.
Would you buy the Hyundai Creta EV for around $20,000? Let us know in the comments below.
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