All Teslas now eligible for used EV tax credit discount as Model 3 and older Model S fit the bill best
After taking its time with submitting the paperwork to make its electric vehicles eligible for the used EV tax credit that has been available to buyers since January 1, Tesla has finally made the move. All Tesla cars are now listed as eligible for the government's used EV tax credit of up to US$4,000, after the buyer meets the following criteria:
- Vehicle must be purchased from a dealer, have a sale price of $25,000 or less, and must have a model year two years prior to the current calendar year.
- Be an individual who bought the vehicle for use and hasn't claimed another used clean vehicle credit in the three years before the purchase date.
- Have modified adjusted gross income that doesn't exceed $150,000 for married filing jointly or a surviving spouse, $112,500 for heads of households, and $75,000 for all other filers.
Besides the income requirement, another challenge to qualify for the used Tesla tax credit would be finding one from a dealer that costs US$25,000 or less. The average used Tesla car price has been dropping like a rock this year, after Tesla cut its new vehicle pricing by up to 30% in January. It is still above forty grand, though, even though that's a whopping 37% drop compared to the same period last year.
Needless to say, the most affordable used Tesla is its current cheapest car - the Model 3 - which still commands a $35,684 average price, according to CarGurus. That's mostly reported dealer pricing, though, or units from Tesla's own used car inventory.
If one buys through a private owner and runs the sale through a dealer for a fee, there are a number of $25,000 or lower listings for older Model 3, or even some Model S units. Hopefully, as Tesla cars get older and it introduces a cheaper to make Model 3 Highland refresh, used Tesla car prices will drop further and more qualified buyers will be able to take advantage of the government's largesse.