Income requirements for EV tax credits: $7.5k new vehicle credit: max $150k income ($300k for joint filers) $4k used vehicle credit: max $75k income ($150k for joint filers) Also 2/

There's a max price for EVs that will qualify for the credits: $80k for SUVs/pickups/vans $55k for smaller vehicles $25k max for used vehicles Additionally, used vehicles must be sold by a dealer and the credit only applies the first time a car is resold (tracked by VIN) 3/

A certain percentage of the battery components (by value) must be made or assembled in North America. This % ratchets up over time: 50% prior to 2024 60% made in 2024-2025 70% in 2026 80% in 2027 90% in 2028 100% beginning in 2029. 4/

There are also requirements for where the battery minerals used in the components originate. A certain % must come from a country the US has a free trade agreement OR must be recycled in North America: 40% in 2023 50% in 2024 60% in 2025 70% in 2026 80% beginning in 2027 5/

Also—and this might be burying the lede a bit—there are restrictions against ANY battery metals or components from "entities of concern." I *believe* that includes China—though haven't seen latest list. Battery manufacturing/assembly restriction begins 2024, materials in 2025 6/

Most restrictions should make the credit more sustainable (2032!) & targeted. The income caps mean a sizable chunk of EV buyers in CA and NY will actually lose access to current credits. The battery origination stuff could drive a lot of domestic manufacturing & recycling 7/

Link to the current language of the "Inflation Reduction Act of 2022." Let me know what I've missed. Obviously nothing is certain until signed, but Manchin and Schumer have pinky sworn that it's happening this time... 8/

This is going to be a lot to process for the average car buyer. Manufacturers must certify battery origins, dealers need to verify pricing requirements, buyers check their last year's tax returns. Lots of room for misunderstanding 9/

@tsrandall @TeslaNY Did this get approved? When will it start?

@TNLS14 @TeslaNY It was agreed to by Manchin (the biggest hurdle) and Schumer, who said the bill will be voted on next week. If it passes, some elements would be retroactive, but I believe most of the EV credits would take effect at the start of 2023.

@tsrandall Does it say when it will become effective if signed into law? Thank you

@Santiag75611536 Some bill elements are retroactive (like solar ITC) but I believe the new EV credit rules begin with vehicles delivered in 2023

@tsrandall Thanks for breaking down the important aspects of the proposed bill. Do we know if the credit phases out after the income limits 150k/300k or if it's a hard limit?

@MonsieurInLA Hard limit. Same with vehicle price caps.

@tsrandall Tax credit or lowers your taxable income by $7500?? I ask because those terms get interchanged and are very different.

@GrantGayman credit

@tsrandall Tom, Does the bill still have a "Union Factory" component? Cheers, Eric

@tsrandall Sure, maybe it encourages EV purchases over ICE, but I don’t think $300k income households need assistance buying a new car.

@tsrandall Not keen on the trade protectionism baked into this. The US needs to be strategic in a different way as to what needs to be produced domestically. If major countries had the same EV subsidy rules, Tesla and others wouldn’t be able to export cars from anywhere.

@tsrandall thx for the thread!