4XE Edition JL Club Thread

[Gazelle]

So it doesn’t need to be a fleet vehicle or used for business purposes? That’s something that I keep seeing too.

I think you may be confusing the US Federal tax credit for a pHEV with writing off the vehicle cost for business use. If an SUV is used for business and the vehicle's GVWR is between 6000 and 14000Lbs, it can qualify for a section 179 write off of up to $25,000. All 4xe's will qualify for the tax credit while the business expense write off only applies to businesses under specific conditions. See section179.org for more details.

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[Pappy06]

Also, part two of that question: would it be wise to change my tax withholdings to pay at the end of the year rather than each paycheck, then buy in January and get the credit? I imagine that would provide the full value of the credit and also be one of the first 200,000 people to buy.

As long as your tax liability is above $7500 you will get the full amount. You just cant get back more than your total liability, as mentioned above. When you pay your taxes is irrelevant. If you have paid $7500 throughout the year in withholding and you owe $0 on your return, you get a $7500 refund. If you paid $0 in withholding throughout the year and you owe that 7500 when you file, the tax credit means you owe $0.

 

[Billkowski]

Your forgetting the $7500 federal tax credit. If the premium for the 4xe is less than $7500, you bank all the savings from the reduced gas consumption. If the premium is only $6000. You already saved $1500. Living in CA with close to $3.00/gallon , the savings will add up pretty quickly.

My commute to work is around 35 miles each way. My employer provides charging stations at no cost. My Jeep renegade gets around 25mpg. That means every day I will use 2 gallons less gas by running the 4xe full electric to and from work for 50 miles. The 4xe electric range is 25 miles. At $3.00/gallon I save $6.00/day , $30/week or $1560/year. There is also increased mpg running in hybrid mode. it would be slightly less because I did not take into account the cost for electricity to charge it up at night at home. But is is relatively small cost and it is at off peak rates.

Is there any kind of tax break on etorque? It's a hybrid...sort of

 

[Pappy06]

Is there any kind of tax break on etorque? It's a hybrid...sort of

Its based on KWH battery it has. Credit is based on first 5kwh then each additional kWh. 4XE has 17 kWh battery. Hope this helps.

 

[Shots]

My commute to work is around 35 miles each way.... ......At $3.00/gallon I save $6.00/day , $30/week or $1560/year......

Your math is good, which is why I said it will pay off for some people. However people like me who have something like 13K miles on my 2 year old Jeep probably won't see the benefit offset the cost. That's not to say it's a bad choice, because you'll likely recoup some of the cost on resale too. Like I said, depending on the cost I'd consider one.

Your forgetting the $7500 federal tax credit....

I had no idea it even existed. Good to know, thanks for the info. That certainly makes it a much more reasonable option, although the impact is minor. Keep in mind a $7,500 tax credit isn't $7,500 cash back, or off your taxes owed. It's a credit (or reduction) from your gross income.

With the median household income of $69,000 (2019) your federal withholding would be roughly $8,200. If you get a tax credit of $7,500 , your taxable income would be $61,500 making your federal withholding roughly $6,500. The difference in the taxes you pay would be $1,700. That amount obviously varies with the tax bracket, so someone in a higher tax bracket will see less of a benefit, whereas someone in a lower bracket will benefit more.

Still, that's no small sum of money, and certainly nothing to shake a stick at. By your figures, it saves you a year of driving to offset the cost of the purchase. Still that's a lot of driving, which clearly you do. Even with the tax credit you would need to drive 3.5 years of full electric (as far as it can) to and from work every day.

 

[Shots]

All this is also assuming such a high initial cast as $7K. If it's closer to the $4K cost of the diesel you'll likely recoup the cost in a year or two after taking advantage of the tax credit.

 

[Pappy06]

Your math is good, which is why I said it will pay off for some people. However people like me who have something like 13K miles on my 2 year old Jeep probably won't see the benefit offset the cost. That's not to say it's a bad choice, because you'll likely recoup some of the cost on resale too. Like I said, depending on the cost I'd consider one.

I had no idea it even existed. Good to know, thanks for the info. That certainly makes it a much more reasonable option, although the impact is minor. Keep in mind a $7,500 tax credit isn't $7,500 cash back, or off your taxes owed. It's a credit (or reduction) from your gross income.

With the median household income of $69,000 (2019) your federal withholding would be roughly $8,200. If you get a tax credit of $7,500 , your taxable income would be $61,500 making your federal withholding roughly $6,500. The difference in the taxes you pay would be $1,700. That amount obviously varies with the tax bracket, so someone in a higher tax bracket will see less of a benefit, whereas someone in a lower bracket will benefit more.

Still, that's no small sum of money, and certainly nothing to shake a stick at. By your figures, it saves you a year of driving to offset the cost of the purchase. Still that's a lot of driving, which clearly you do. Even with the tax credit you would need to drive 3.5 years of full electric (as far as it can) to and from work every day.

Your math is good, which is why I said it will pay off for some people. However people like me who have something like 13K miles on my 2 year old Jeep probably won't see the benefit offset the cost. That's not to say it's a bad choice, because you'll likely recoup some of the cost on resale too. Like I said, depending on the cost I'd consider one.

I had no idea it even existed. Good to know, thanks for the info. That certainly makes it a much more reasonable option, although the impact is minor. Keep in mind a $7,500 tax credit isn't $7,500 cash back, or off your

With the median household income of $69,000 (2019) your federal withholding would be roughly $8,200. If you get a tax credit of $7,500 , your taxable income would be $61,500 making your federal withholding roughly $6,500. The difference in the taxes you pay would be $1,700. That amount obviously varies with the tax bracket, so someone in a higher tax bracket will see less of a benefit, whereas someone in a lower bracket will benefit more.

Still, that's no small sum of money, and certainly nothing to shake a stick at. By your figures, it saves you a year of driving to offset the cost of the purchase. Still that's a lot of driving, which clearly you do. Even with the tax credit you would need to drive 3.5 years of full electric (as far as it can) to and from work every day.

Incorrect, The $7500 tax credit is just that, a tax credit. It is not a deduction on your taxable income. It reduces your tax liability by $7500, it does not reduce your tax by the difference in taxable income.

I was counting it as deduction also until Tesla set me straight. I confirmed with my CPA. And don’t forget state taxes. Here in CO, you get a $4000 state tax CREDiT until end of this year and it becomes $2000. Check for respective states.

 

[Shots]

Thanks for the info. I hope I am looking at it wrong, because that would be a huge incentive to a lot of people.
I'd have to check with an accountant on that one though (as you did). Not that I don't believe that you did, but It seems illogical to me. If the feds give you all of that it would eliminate 91% of the tax from an average household. Plus an individual state giving you cash back too. If that is how it works, you'd potentially be better off buying a new hybrid every year, to essentially eliminate your tax withholdings. I don't see how a government (state or federal) could function like that. Certainly something worth looking into though. Maybe they're banking on people not knowing about it.

 

[Pappy06]

I couldn’t believe it at first either. This article simplified the language in the Revenue code:

https://cars.usnews.com/cars-trucks/how-does-the-electric-car-tax-credit-work

Also, there are limits. The credits end when the model sells 200,000 copies.

 

[orejo]

Future 4xe owner checking in! Ordered my Snazzberry Sahara on 11/6 and am eagerly awaiting her arrival. This will be my first Jeep, but my second PHEV.

 

[Shots]

Don't forget to take that tax break.
I'm assuming they still do the blue accents on Snazzberry? That will be in interesting combo to see. Any word on when these will start to roll out? Or is it just standard 2-3 month order time?

 

[MoparMike]

Future 4xe owner checking in! Ordered my Snazzberry Sahara on 11/6 and am eagerly awaiting her arrival. This will be my first Jeep, but my second PHEV.

Congratulations! We finally have 4xe owners showing up in here, everyone else is talking about tax credits.

 

[Pappy06]

Future 4xe owner checking in! Ordered my Snazzberry Sahara on 11/6 and am eagerly awaiting her arrival. This will be my first Jeep, but my second PHEV.

And if you could, hound your dealer to get you your pricing ASAP. And please let us know. That’s all I’m waiting on.

 

[Shots]

Congratulations! We finally have 4xe owners showing up in here, everyone else is talking about tax credits.

Yeah, but that credit may bring more owners.

 

[MoparMike]

Yeah, but that credit may bring more owners.

Hey, don't get me wrong, it will bring in more buyers. I just want to see who on the forums is getting a 4xe first.

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