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All the large international battery makers are opening factories in the US, such as LG. So this shouldn't be an issue
 

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This article leads me to believe that once the bill is signed, only Chattanooga built ID.4s have a shot at the rebate. I further think they may qualify for half the $7500 credit - the half based on where battery components are made.

Dave
VW also uses LG battery, right? LG is building their battery factory in the US
 

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This article leads me to believe that once the bill is signed, only Chattanooga built ID.4s have a shot at the rebate. I further think they may qualify for half the $7500 credit - the half based on where battery components are made.

Dave
After re-reading the proposed Act again a couple of times, my conclusions are modified to:

1. The 2022s will qualify for the "old" rebate provided they are placed in service before January 1, 2023 or they have a "binding sales contract" in place before that date.

2. Anything sold after December 31, 2022 plays by the new rules, including requirements for final assembly in North America, critical battery mineral, and battery component requirements. I suspect the 2023 ID.4 will qualify under battery components half, but I'm not sure it will qualify for the battery minerals half.

Note: This is not tax advice and I am not a lawyer.

Dave
 

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Discussion Starter · #7 · (Edited)
Yeah, the updates go much further than the current one. Date of implementation would for any car acquired after Dec 31, 2022.

It seems to remove the tax liability requirement for the implementation of income and total sales price limits (Manufacture Suggested Retail Price, not out the door price). So that's the first hoop.

Income limits you have to stay below:​

  • Joint/Surviving Spouse - $300,000
  • Head of Household - $225,000
  • Other - $150,000
Pricing:​

  • Van/SUV/Pickup - $80,000
  • Any other vehicle - $55,000
The second hoop is much stiffer and has forced time gates for more and more of the battery pack to both be assembled AND sourced from North America (either new or recycled) or 'free trade' partners. Broadly:
  • Critical materials - $3,750
  • Final assembly in North America - $3,750
The dates and percentages for the critical materials:​

  • CY 2024 - 50%
  • CY 2025 - 60%
  • CY 2026 - 70%
  • CY 2027 - 80%
Removes the cap on the total number of vehicles that are eligible per manufacturer.

It's too many pages to copy the entire bill text. You can read it for yourself here ERN22335 (senate.gov) starting on page 366. Though it's a bit messy, as it's a reconciliation bill that modifies existing code passed in previous legislation. So it's essentially a 'diff' for those that know what that means.

And at the bottom, there seems to be a provision for allowing a second buyer (and only a second buyer) to claim an additional credit when they buy a qualifying used EV that is more than 2 years old and under $25k in price of up to an additional $4k or 30% of the sale price, whichever is lower.
 

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All the large international battery makers are opening factories in the US, such as LG. So this shouldn't be an issue
Won't the battery minerals sourcing be an issue? My suspicion is that the ID.4, along with most other EVs, are going to end up with half the Credit. It should qualify for the "US built battery components" half of the Tax Credit, but I think it is unlikely it will qualify for the "battery minerals sourcing" half of the Credit. I may be wrong, but I don't think many of the critical battery minerals are "extracted or processed" in the correct countries.

This is part of the reason for the changes: lawmakers want to promote building up a supply chain for minerals that doesn't depend on China, Russia, The Republic of Congo, etc.

My hope is they put in a longer transition time for the battery minerals part of the credit.

Dave
 
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