The U.S. Treasury Department has changed the standard for what kind of electric vehicles qualify for a federal tax benefit under the Inflation Reduction Act. 

Before this change, electric vehicles such as the Tesla Model Y, Ford Mustang Mach-E, Cadillac Lyriq, and Volkswagen’s ID.4 were not considered SUVs because of their lower weight. This meant they couldn't access the credit that capped Manufacturer Suggested Retail Price (MSRP) at $80,000, and they were too expensive to get access to the credit with the $55,000 cap. 

Tesla CEO Elon Musk tweeted a month ago that the prior rule was "messed up!"

Now these newly minted SUVs qualify for the $7,500 credit if they cost $80,000 or less, while cars, sedans, and wagons continue to qualify if they are priced less than $55,000. 

"This change will allow crossover vehicles that share similar features to be treated consistently," said the Treasury Department in a press release. "It will also align vehicle classifications under the clean vehicle credit with the classification displayed on the vehicle label and on the consumer-facing website FuelEconomy.gov." 

Share:
More In Business
Apple posts stronger-than-expected Q2 results
Apple CEO Tim Cook said Thursday that the majority of iPhones sold in the U.S. in the current fiscal quarter will be sourced from India, while iPads and other devices will come from Vietnam as the company works to avoid the impact of President Trump’s tariffs on its business. Apple’s earnings for the first three months of the year topped Wall Street’s expectations thanks to high demand for its iPhones, and the company said tariffs had a limited effect on the fiscal second quarter’s results. Cook added that for the current quarter, assuming things don’t change, Apple expects to see $900 million added to its costs as a result of the tariffs.
Load More