Trade in before 30 months (Fed tax credit/rebate problem)

Your federal tax credit does not have a period you must keep the car to claim the full credit.

Here is the IRS site for detail: Plug In Electric Vehicle Credit IRC 30 and IRC 30D | Internal Revenue Service

"Resale" in the stipulation is buying a car to resale as a new car to prevent a dealer to take the tax credit. A consumer buying a car and using the car for 16 mo and selling a used car is not a "resale".

Read this thread for more detailed discussion: Federal $4502 tax credit - what is consider resale? | PriusChat

However, your state, like many other, incentives does require you to keep the car for a longer period. NY seems to be 30 months. Ours is 36 mos. If you sell or trade your car before the required period, you may have to return the state incentive.

 

You'll likely be on the hook for that NY rebate amount if you trade in now.

Honestly, you are better off waiting for a Rav4 Prime even if that isn't the case. First year models always have a higher chance of having issues. Then there is a chance of discounts on the car later. Right now, the best you will likely find is MSRP. Some dealers have mark ups on the car now.

 

Don’t you have two vehicles?

just keep your current prime and trade in your other vehicle

 

I've sold my 2018 PP after around 12 months to get the 2020 PP. I don't think there should be any issues.

 

Traded in my prime every year in ny

they never asked for money back

 

It is doubtful you will get a Rav4 Prime in 2021. An order from four months ago was scheduled for January in our area. The buyer was told its likely in December 2021 and Toyota corporate is not accepting new orders.

Likely due to covid slowdowns in Japan plus a current semiconductor shortage.

 

OP, is the FAQ from the state of NY or CA? You use the rules from where you applied for the rebate.

See below.

More info for NY residents:

1. Are there requirements for how long I need to keep the car?
   Yes. Car purchases require an ownership period of at least 36 months. Car leases require an original lease term of at least 36 months.
2. What are the repercussions of violating the 36-month ownership and lease requirement?
   NYSERDA will enforce the 36-month ownership and lease requirement. NYSERDA may seek reimbursement for a portion of the original rebate amount if the requirement is violated. If you are in this situation, contact the Drive Clean Rebate staff to resolve your 36-month ownership requirement using the contact information at the bottom of this page.

Consumer FAQ - NYSERDA

 

can you rephrase that?

 

Btw Is there a form to print out for the $4,502 credit?

I had to fill out like 4/5 papers just for the Pennsylvania $500 DEPA rebate.. including copies of receipts etc

sorry for the newb question, but it’s my first time doing something like this

 

When you file your federal taxes with the IRS include form:

About Form 8936, Qualified Plug-In Electric Drive Motor Vehicle Credit | Internal Revenue Service

Whatever is in the last line, goes into 1040 Schedule C line 6

https://www.irs.gov/pub/irs-pdf/f1040s3.pdf

 

As said above. Use form 8936 on your Fed income tax return for the year you purchased the vehicle. If you use Tax software like Turbo Tax, this form is available online and will fill out appropriate number in your tax forms by answering a few questions about the car you purchased. Historically, it takes while for IRS to update this form for the current tax year, so you may have to wait until the form is updated by IRS. Form 8936 for 2020 filing is not yet available at linked IRS site yet.

 

Thank you very much for the information !

 

When I looked a couple of weeks ago I didn't see any RAV Primes available north of Boston. Also I read an article that
indicated that they were in short supply due to lack of battery availability.

 

Toyota really underestimated the demand. They stopped taking orders in Japan months ago.