CHAIRMAN’S MESSAGE Clean Vehicle Tax Credits Become “Cash on the Hood” Incentive for Customers Starting January 1, 2024 JAMES CURLEY, III As of January 1, 2024, customers will be able to transfer their federal new and used clean vehicle tax credits to dealerships registered through the Energy Credits Online (ECO) portal at the time of sale. Moreover, as of January 1, all dealers (regardless of whether the customer elects to transfer credits or not) must submit time of sale reports for clean vehicle transactions through the ECO portal. Dealers must be registered with the ECO portal in order to submit the time of sales reports. Seller Reports are also necessary for clean vehicle sales involving certain credits (Sections 30D and 25E (used) credits) and must be provided to both buyers and the IRS at the time of sale. If you are unsure what to do, there are abundant resources. The IRS issued a new User Guide in late December, with step-by-step instructions explaining how to create time of sale reports for clean vehicle sales in the ECO portal. The IRS also issued updated dealer registration FAQs, important background information for consumers about transferring clean vehicle tax credits, and a checklist of information buyers must provide to eligible dealers for clean vehicle sales involving the transfer of credits. The above-mentioned resources can be found via the QR codes at the end of this article. BACKGROUND ON CREDITS FOR NEW CLEAN VEHICLES PURCHASED IN 2023 (OR AFTER) Consumers may qualify for a clean vehicle tax credit of up to $7,500 under Internal Revenue Code Section 30D if they buy a new, qualified plug-in EV. In order to qualify, the customer must buy the qualifying vehicle for their own use (not for resale) and use the vehicle primarily in the U.S. In addition, the customer’s modified adjusted gross income (AGI) may not exceed $300,000 for married couples filing jointly, $225,000 for heads of households, or $150,000 for all other filers, and customers can use their modified AGI from the year they take delivery of the vehicle or the year before, whichever is less. 10 new jersey auto retailer
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