![]() You can’t claim the credit for purchasing a new EV if your modified adjusted gross income exceeds $300,000 for joint filers, $225,000 for head-of-household filers, or $150,000 for single filers. An EV’s classification as a sedan a van, SUV, or pickup truck is based on the vehicle’s fuel economy label on the window sticker and the EPA size class published at the website. First, the manufacturer’s suggested retail price can’t exceed $55,000 for sedans and $80,000 for vans, SUVs, and pickup trucks. This limitation has been removed for electric vehicles purchased in 2023 and later.īut two new rules could prevent you from claiming the tax break if you buy a new EV. Under pre-2023 rules, some popular car brands didn’t qualify for the credit because it started to phase out for vehicles manufactured by a car company that sold over 200,000 EVs in the U.S. ![]() The manufacturer sales threshold limit is gone. This last rule applies to all EVs first placed in service after Aug. Also, the final assembly of the EV must take place in North America. ![]() Eligibility for the full $7,500 credit for EVs put in use before April 18 is based on the vehicle’s battery capacity. If only one factor is met, then the credit is capped at $3,750. To be eligible for the full $7,500 credit, EVs put in use after April 17, 2023, must meet a critical minerals requirement and a battery component rule. But the factors for figuring the credit are new. For 2023 through 2032, the maximum tax break remains $7,500 for buying a new EV. The tax credit for buying an electric vehicle has been completely revamped by last year’s Inflation Reduction Act (including a name change from the electric vehicle tax credit to the clean vehicle credit). More: Tax Credits for Energy-Efficient Home Improvements Third, you can also get a credit of up to $150 for the cost of a home energy audit. The annual limit increases to $2,000 for a biomass stove or hot water boiler, or an electric or natural gas heat pump put in the home. This $1,200 annual limit is lowered to $500 in the aggregate for exterior doors and $600 for exterior windows and skylights and other items. Second, the $500 lifetime limit is replaced with a $1,200 annual limit. First, the credit percentage increases to 30% of the cost of certain types of insulation, boilers, air-conditioning systems, windows, doors, etc. This credit is now bigger and better for 2023 through 2032. And the credit was capped for many items. There was a lifetime credit limitation of $500. It also included the cost of electric heat pumps and water heaters, some central air-conditioning systems, and similar energy-saving investments. ![]() For 2022, the credit applied to 10% of the cost of certain types of insulation, plus external windows, doors, and skylights. in your home has been completely revamped, beginning this year. The tax credit for installing energy-efficient windows, doors, etc. It kicks in for single people with modified adjusted gross income over $200,000 and for joint filers with modified AGI over $250,000. The 3.8% surtax on net investment income stays the same for 2023. The 15% rate is for filers with taxable incomes between the 0% and 20% breakpoints. In 2023, the 0% rate applies for individual taxpayers with taxable income up to $44,625 on single returns ($41,6), $59,750 for head-of-household filers ($55,8), and $89,250 for joint returns ($83,3). However, the income thresholds to qualify for the various rates were adjusted for inflation. Tax rates on long-term capital gains (i.e., gains from the sale of capital assets held for more than one year) and qualified dividends did not change for 2023.
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