supamyk

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There's a great post someone made explaining in detail how it works, but it has nothing to do with refunds it's all about your tax liability. You just need to have at least 7500 of liability to get the full tax credit.

Getting 10k back just means you overpaid for that tax year
So if make over 130,000 a year and get taxes taken out because I am a teacher, I will be fine. Correct





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ElHobbz

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So if make over 130,000 a year and get taxes taken out because I am a teacher, I will be fine. Correct
It's not that easy, for ex: I have a kid, donate, invest (losses), max out 401k fsa hsa and itemize my deductions to decrease my liability. Assuming you are single and don't do any of the above and just take standard deduction and if I were a betting man I would say yes.

Edit: I am not a CPA just a software dev that tries to keep as much as my money as possible....
 

supamyk

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Thanks. So basically what line do I look at on my return to see if I’m ok?
 

Jeeperz Kreeperz

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Yes, definitely line 24 of form 1040 is the key (Not sure if it will remain as line 24 for 2021), but what you are looking for is your “Total Tax”. This needs to be over $7,500 to get the full $7,500 credit.

I wrote a detailed post about it here that explains in detail how the credit works, and provides a couple of examples that should help clarify the interplay between withholding, refund, tax liability, and EV tax credit:

https://www.jlwranglerforums.com/fo...eage-epa-figures-published.68287/post-1442151

I work with clients on these issues often, and there is a lot of confusion surrounding the EV tax credit. Neither your tax refund, nor your tax bill due at filing time can tell you whether you are eligible for the full $7,500 tax credit. Increasing your withholding will have zero impact on your eligibility for the full credit. It’s all about your tax liability or “Total Tax” (Not to be confused with “Amount You Owe” on line 37!).

As always, with any advice you receive on a forum like this, be sure to run it by your tax advisor! And here’s another tip: If you look at your 2020 form 1040, and line 24 is less than $7,500, but you purchased (or plan to purchase) an 4xe in 2021, talk to your accountant or financial advisor well before year-end about strategies to increase your tax liability (e.g., retirement plan distributions, Roth conversions, etc.) in order to absorb the full credit.
 
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dalema

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The other question floating around is to get confirmation from someone who leases one - as to if this will get applied against the cap cost of a lease - through Chrysler Capital?

Maybe another way to realize it.
 

insomniac

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It's probably not going to be line 24 in 2021 (as the line number will change year to year). But if you want to use 2020 as a guide line 24 will work for your 2020 tax year return.
 

ElHobbz

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I
Yes, definitely line 24 of form 1040 is the key (Not sure if it will remain as line 24 for 2021), but what you are looking for is your “Total Tax”. This needs to be over $7,500 to get the full $7,500 credit.

I wrote a detailed post about it here that explains in detail how the credit works, and provides a couple of examples that should help clarify the interplay between withholding, refund, tax liability, and EV tax credit:

https://www.jlwranglerforums.com/fo...eage-epa-figures-published.68287/post-1442151

I work with clients on these issues often, and there is a lot of confusion surrounding the EV tax credit. Neither your tax refund, nor your tax bill due at filing time can tell you whether you are eligible for the full $7,500 tax credit. Increasing your withholding will have zero impact on your eligibility for the full credit. It’s all about your tax liability or “Total Tax” (Not to be confused with “Amount You Owe” on line 37!).

As always, with any advice you receive on a forum like this, be sure to run it by your tax advisor! And here’s another tip: If you look at your 2020 form 1040, and line 24 is less than $7,500, but you purchased (or plan to purchase) an 4xe in 2021, talk to your accountant or financial advisor well before year-end about strategies to increase your tax liability (e.g., retirement plan distributions, Roth conversions, etc.) in order to absorb the full credit.
I was looking for your post!!! It should be a sticky in my opinion. 10k refund sounds like a lot. I thought the goal was to be as close to 0.
 

Bumps Ahead

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I was looking for your post!!! It should be a sticky in my opinion. 10k refund sounds like a lot. I thought the goal was to be as close to 0.
My goals....

Refund = Uncle Sam borrowed free money from you, not ideal
Even = You walked away without a win or a loss, boring
Owe = You used house money to play with for the past year, interest free....BTC anyone? 💰
 

Jocko

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The other question floating around is to get confirmation from someone who leases one - as to if this will get applied against the cap cost of a lease - through Chrysler Capital?

Maybe another way to realize it.
Take this with a grain of salt since I have not personally closed a lease on a 4xe yet, but my dealer tells me yes and I have seen multiple people post online that they have also gotten confirmation. So it sounds like both Chrysler Capital and Ally are passing the full 7500 through at the moment.
 

dalema

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Take this with a grain of salt since I have not personally closed a lease on a 4xe yet, but my dealer tells me yes and I have seen multiple people post online that they have also gotten confirmation. So it sounds like both Chrysler Capital and Ally are passing the full 7500 through at the moment.
live heard someone say Ally is but am looking for confirmation for CCAP. on the edmunds forum they had noted they don’t - hence the question.
 

Jocko

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Hmm I'll chime in if I get more specific confirmation on Chrysler Capital.
 

dalema

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Oh - also on the edmunds forum they noted that CCAP is waiving the acquisition cost for leases. Only on the hybrids. Good one to check for if anyone is leasing.
 

GeneralKlinger

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So if make over 130,000 a year and get taxes taken out because I am a teacher, I will be fine. Correct
Where does a Teacher make over $130K a year? My sister in law is an Art teacher for a High school and makes around $65K.
 

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