Wrangler 4XE Pricing

[milesjj_20]

My understanding is that the $7500 credit only applies to you if you own taxes at the end of the year you purchased the car. And if, let's say you only owe $1000 that year, that's all the tax credit you are getting. There isn't going to be a $6500 refund check on top of that.

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[Sboden]

There is another thread on this. It has nothing to do with how much you owe or will get in a refund at the end of the year.

 

[milesjj_20]

There is another thread on this. It has nothing to do with how much you owe or will get in a refund at the end of the year.

About the tax credit specifically or the 4xe pricing? Because while I found the latter, there seems to be a lot of misinformation in there as well about the former.

 

[Chris Hall]

My understanding is that the $7500 credit only applies to you if you own taxes at the end of the year you purchased the car. And if, let's say you only owe $1000 that year, that's all the tax credit you are getting. There isn't going to be a $6500 refund check on top of that.

It isn’t what you owe at the end of the year, it’s your total liability. If you paid say $10,000 throughout the year but found that you owed $2,000 come tax time, your total liability for that year is $12,000. Now, let’s say you paid $10,000 throughout the year and found out that you are going to get a $2,000 refund, your total liability is $8,000. What you owe or what you receive as a refund at the end of the year has nothing to do with if you can get the $7500 credit. It only has to do with your total liability.

 

[milesjj_20]

It isn’t what you owe at the end of the year, it’s your total liability. If you paid say $10,000 throughout the year but found that you owed $2,000 come tax time, your total liability for that year is $12,000. Now, let’s say you paid $10,000 throughout the year and found out that you are going to get a $2,000 refund, your total liability is $8,000. What you owe or what you receive as a refund at the end of the year has nothing to do with if you can get the $7500 credit. It only has to do with your total liability.

In either of those scenarios, how will the qualification for the $7500 pay out?

 

[bondijoe]

In either of those scenarios, how will the qualification for the $7500 pay out?

In scenario 1, your tax liability is reduced by 7,500 from 12,000 to 4,500. Since you paid 10,000, you get a 5,500 rebate.

In scenario 2, your tax liability is reduced by 7,500 from 8,000 to 500. Since you paid 10,000, you get a 9,500 rebate.

 

[misanthrope]

My understanding is that the $7500 credit only applies to you if you own taxes at the end of the year you purchased the car. And if, let's say you only owe $1000 that year, that's all the tax credit you are getting. There isn't going to be a $6500 refund check on top of that.

People are overcomplicating this.
If you were required to pay more than $7500 in federal taxes for the year, then you qualify for the full tax credit of $7500.
Whether you overpaid your taxes, meaning you will get a refund or underpaid them so you owe taxes has ZERO bearing on whether you are entitled to the tax credit.
The credit merely knocks $7500 off of your tax liability (what you were required to pay, usually through payroll deduction with each paycheck) for the year.
So in your scenario, you would, indeed, get that $6500 rebate, SO LONG AS your annual tax liability exceeds $7500, which is probably the case for the vast majority (99.9%)of people buying a $50-60k 4xe.

 

[PaulwithJeep]

Hey everyone I just wanted to let you know that my build sheets and order site have updated and now have ALL the pricing for the 4xe Sahara and Rubicon. Anyone curious about the pricing for specific builds can contact me for info.

 

[sixspeed]

The footnote to always mention with the $7500 credit is that it depends on your tax situation. If you only owe $6000 in federal in the year that you purchase, you only get a $6000 credit.

Also, and I don’t know this, but there may be less credit for a hybrid, of which the 4xe is, than a 100% electric.

 

[PaulwithJeep]

Also, and I don’t know this, but there may be less credit for a hybrid, of which the 4xe is, than a 100% electric.

Chrysler specifically makes their batteries large enough to qualify for the largest available federal tax credit.

 

[Sboden]

I have a price for my build today also.

 

[misanthrope]

Also, and I don’t know this, but there may be less credit for a hybrid, of which the 4xe is, than a 100% electric.

So long as it's a plug-in hybrid, like the 4xe, it qualifies for the full credit.

 

[dudemind]

The confusion surrounding the $7500 tax credit comes from the fact that the vast majority of people don't understand how taxes work in America.

Your tax bill/refund when you file your annual taxes doesn't actually matter one bit. Reread that if you think that the $7500 has anything to do with your tax refund. It does not.

Throughout the year, most paycheck earners set aside a portion of each paycheck in the form of withholdings. That doesn't mean that your withholding was your actual tax liability, only that your employer made a forward-looking estimate of your final tax liability and prepaid some portion of that on your behalf.

Your actual tax liability is only known after the year ends, when you get all of your statements and you (or your CPA) calculate what you were ultimately supposed to pay. At this point (and only at this point), the money you set aside in the form of withholdings from each paycheck is then compared to this actual liability. If it turns out you set aside too much each paycheck, you get that difference back in the form of a refund. If you set aside too little, you now have a tax bill. Your refund/bill is merely the difference between what you prepaid and what your actual liability came out to. It does not, in and of itself, say anything about your tax liability.

The $7500 electric vehicle tax credit is based solely off the number you were supposed to pay. Whether or not you already paid exactly that amount throughout the year does not matter one bit towards your eligibility.

Let's look at a totally contrived example illustrating what seems to be throwing some people off... Say you were supposed to pay $10,000 one year. But, during that year, the payroll processing person at your company somehow royally messed up, and you actually set aside a whopping $50,000 from your paychecks. When you file your taxes, you're going to get the $40,000 back in the form of a refund. And, if you buy the Wrangler 4xe, you're ALSO GOING TO GET ANOTHER $7500 BACK, even though you are receiving a refund. This illustrates that you do not have to owe more in taxes at the end of the year to benefit from the $7500.

In an ideal world, your final tax bill/refund should be $0. Meaning you neither over- nor underpaid your taxes via withholdings throughout the year. In practice, this is just about impossible to achieve. Some of this is out of your control, as it's nearly impossible (or, at the very least, highly impractical) to precisely predict things like dividends, capital gains, bonuses, mid-year tax law changes, etc. But you can get as close as possible by correctly filling out and updating your W4, especially after major life events.

An interesting side note is that it's possible to effectively obtain an interest-free loan from the government by deliberately filling out your W4 incorrectly, but it's also against the law to knowingly do so...

 

[dudemind]

Got so caught up in my little tax-explainer that I forgot to ask my question... Has anybody definitively heard whether the 4xe is eligible for Affiliate (e.g., Tread Lightly) pricing? A couple local dealers have said FCA is no-go on it (including one who honored Tread Lightly on my first JL). Curious if others have heard the same...

 

[Chris Hall]

The confusion surrounding the $7500 tax credit comes from the fact that the vast majority of people don't understand how taxes work in America.

Your tax bill/refund when you file your annual taxes doesn't actually matter one bit. Reread that if you think that the $7500 has anything to do with your tax refund. It does not.

Throughout the year, most paycheck earners set aside a portion of each paycheck in the form of withholdings. That doesn't mean that your withholding was your actual tax liability, only that your employer made a forward-looking estimate of your final tax liability and prepaid some portion of that on your behalf.

Your actual tax liability is only known after the year ends, when you get all of your statements and you (or your CPA) calculate what you were ultimately supposed to pay. At this point (and only at this point), the money you set aside in the form of withholdings from each paycheck is then compared to this actual liability. If it turns out you set aside too much each paycheck, you get that difference back in the form of a refund. If you set aside too little, you now have a tax bill. Your refund/bill is merely the difference between what you prepaid and what your actual liability came out to. It does not, in and of itself, say anything about your tax liability.

The $7500 electric vehicle tax credit is based solely off the number you were supposed to pay. Whether or not you already paid exactly that amount throughout the year does not matter one bit towards your eligibility.

Let's look at a totally contrived example illustrating what seems to be throwing some people off... Say you were supposed to pay $10,000 one year. But, during that year, the payroll processing person at your company somehow royally messed up, and you actually set aside a whopping $50,000 from your paychecks. When you file your taxes, you're going to get the $40,000 back in the form of a refund. And, if you buy the Wrangler 4xe, you're ALSO GOING TO GET ANOTHER $7500 BACK, even though you are receiving a refund. This illustrates that you do not have to owe more in taxes at the end of the year to benefit from the $7500.

In an ideal world, your final tax bill/refund should be $0. Meaning you neither over- nor underpaid your taxes via withholdings throughout the year. In practice, this is just about impossible to achieve. Some of this is out of your control, as it's nearly impossible (or, at the very least, highly impractical) to precisely predict things like dividends, capital gains, bonuses, mid-year tax law changes, etc. But you can get as close as possible by correctly filling out and updating your W4, especially after major life events.

An interesting side note is that it's possible to effectively obtain an interest-free loan from the government by deliberately filling out your W4 incorrectly, but it's also against the law to knowingly do so...

I regret that I only have one like to give this post. Well done.

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