The IRS today released an advance version of Notice 2018-96 announcing the section 30D credit phase-out schedule for new qualified plug-in electric drive motor vehicles sold by Tesla, Inc.
Section 30D provides a credit of up to $7,500 for new qualified plug-in electric drive motor vehicles sold after December 31, 2009. The qualified plug-in electric drive motor vehicle credit begins to phase out for a manufacturer’s qualified plug-in electric drive motor vehicles in the second calendar quarter after the calendar quarter in which at least 200,000 of the manufacturer’s vehicles that qualify for the credit have been sold for use or lease in the United States (determined on a cumulative basis for sales after December 31, 2009).
Section 30D provides the following schedule for phasing out the credit:
Notice 2018-96 [PDF 16 KB] states that Tesla, Inc. submitted reports indicating that its cumulative sales of qualified vehicles reached the 200,000-vehicle limit during the calendar quarter ending September 30, 2018. Accordingly, the credit for all new qualified plug-in electric drive motor vehicles sold by Tesla, Inc. will begin to phase out January 1, 2019.
According to the IRS notice, for a new qualified plug-in electric drive motor vehicle sold by Tesla, Inc. (that is, purchased for use or lease in the United States), the allowable credit is:
Read a related IRS release: IR-2018-252
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