The Porsche is where it’s at when it comes to vehicles that can offer premium performance with good reliability ratings. Even its line of EVs impresses a whole range of reviewers. But, these models aren’t exactly cheap.
However, to help offset the cost of a Porsche, you can take advantage of the federal tax credit program that would save you money when the tax season rolls around. According to electrek, you could qualify for up to $7,500.
How does the Tax Credit Work?
The Tax Credit is an incentive to get consumers to purchase electric vehicles or some hybrid models instead of gas-powered ones. The IRS offers a tax credit of $2,500 up to $7,500 to help make the transition to electric cars much easier for those hesitant to switch over. How much you receive will depend on the battery size and your income tax figures.
However, the credit isn’t for just any EV on the market. It’s only available for vehicles purchased after 2010 when the tax break became available. It’s also only available to the original owner, who purchased it new. Some of these EVs don’t qualify. Tesla and General Motors vehicles are no longer eligible for the incentive.
According to the IRS, an EV that draws propulsion energy from a 5 kWh battery qualifies for $2,500. On top of that, you can get $417 for each kWh of battery capacity that goes over the initial 5 kWh. The maximum amount allowed is $7,500. The credit is only available for manufactured EVs that haven’t surpassed the 200,000 vehicles produced mark.
Porsche’s stamp on the EV industry
Porsche isn’t a new player in the automotive game, but it is rather new to the electric vehicle game. The company’s plan for the future is to switch at least 50 percent of its models over to an electric drivetrain around the year 2025. Porsche also hopes to take it one step further by changing the way vehicles are produced. The automaker wants to provide a factory that has zero impact on the environment.
As for tax credits, you’ll get a range of incentives with the Porsche models. According to the U.S. Department of Energy, the 2020 Cayenne E-Hybrid, qualifies for a $6,712 credit. The 2020 Panamera 4 E-Hybrid model also gives you $6,712 toward your taxes. The lowest amount available is the 2015 918 Spyder, which still gets you $3,667.
For the electric models, like the 2021 Taycan 4S and the Taycan Turbo, you can expect the full $7,500 credit. Even the Turbo S and the 2021 Taycan EV qualify for the same incentive due to each model’s fully electric drivetrain and being a brand-new version.
How to benefit the most from the tax credit
If you’re in the market for an EV and want to take advantage of the federal tax credit, there are a few things to keep in mind. One, find a brand-new EV that’s on the list of qualified vehicles for the credit. Remember, it’s only for the original owner and will still depend on the amount of your owed taxes. If you only owe about $5,000 to the IRS, that’s the amount of credit you would receive, which would put you at zero. No refund will be given.
The $7,500 incentive is what dealers will use to entice you to purchase the vehicle. You won’t get that amount subtracted from the price of the car. It’s only for placing on your tax form when you fill out your taxes next year. If you owe taxes, then this incentive could still provide a benefit.
On top of the federal tax credit, there are a few other discounts to take advantage of. Check with the state you live in to see what’s available to help offset the cost of a brand-new electric vehicle. For example, California has a rebate that you could qualify for. If you’re eligible, you could get $2,000 to $4,500 on top of any federal credit you might qualify for.
Getting one of Porsche’s EVs might be a worthwhile purchase if you qualify for the federal tax credit and any state rebate options you might be eligible for. Any type of incentive to help offset the cost of the Porsche EV is always welcome.