IRS lets electric vehicle buyers claim to fail to trace back tax credit

The $7,500 federal electric vehicle tax credit has pushed many Americans to push electric, but the program isn’t entirely smooth sailing. While credit can now be applied directly at the point of sale, some dealerships have been dragging their pace, leaving buyers high and dry without the promised discount. But, the good news: There is a solution at work.

Read: Dealer’s paperwork errors make buyers lose EV tax credits with IRS

It turns out that while discounts are available at the time of purchase, dealers must join the program and use the portal to submit their electric vehicle sales report within three days of the transaction for credit. Missed that deadline and rebate? po. Leaving.

The IRS intervenes with lifeline

Fortunately, the IRS is adding to the plate. According to the National Automobile Dealers Association (NADA), the agency is actually hitting the reset button on the 3-day reporting rule. Dealers can now submit reports from any qualified clean vehicle credit transaction starting in 2024, even if it happened at the beginning of the year.

According to NADA, the IRS updated the portal earlier this week to get dealers to run fully. The good news here is not only for car buyers, but also for dealers. Some dealers offered tax credits to customers at the point of sale, but later realized they hadn’t received actual rebates.

Nada said it was “actively advocated that the IRS be corrected” and even sent formal letters to the U.S. Treasury and the IRS, urging them to quickly resolve the issue and implement timely solutions.

Starting April 2, the Trump administration will impose a 25% tariff on all cars imposed overseas, so the tax credit is now more valuable than any other time. These new tariffs are expected to increase the cost of new and used cars, potentially increasing the price of thousands of dollars. So, a $7,500 credit will become even more valuable for many buyers.