Another manufacturer has sold enough qualified electric vehicles[1] to begin phasing out the tax credit for purchasing the manufacturer’s vehicles.  In Notice 2019-22 the IRS announced that the credit for qualified plug-in electric vehicles sold by General Motors would be phased down beginning April 1, 2019. 

Before April 1, 2019, the credit for the affected vehicles was $7,500.  From April 1, 2019 through September 30, 2019, buyers of the qualifying General Motors vehicles will receive 50% of the otherwise allowable credit ($3,750).  For the period from October 1, 2019 through March 31, 2020, buyer will receive 25% of the otherwise allowable credit ($1,875).  No credit will be allowed for purchases of vehicles after April 1, 2020.

In Notice 2018-96 the IRS provided notice that the credit for Tesla manufactured plug-in electric vehicles will be phased-out during 2019.

In a pair of cases (Trout v. Commissioner, TC Summary Opinion 2015-66 and Podraza v. Commissioner, TC Summary Opinion 2015-67) the Tax Court applied the standard of “placed in service” to determine if the taxpayers in each case properly claimed a credit for purchase of an electric vehicle.