While Elon Musk Was Playing With Twitter the Model Y’s Tax Credit Got Axed
The IRS has released its all-new list of eligible electric vehicles for 2023. Almost every EV you can think of is on the list, save for the five-seat SUV. Must have been a bad week being an accountant at Tesla. What happened to the Form Y tax credit?
Tesla Model Y is an SUV, except when it isn’t (which means no tax credit)
According to the IRS, only the seven-seater version is a Model Y, while the five-seater (which looks identical) is just a sedan. An SUV qualifies for the tax credit, while a sedan does not. It has to do with pricing, but more on why pricing matters later. Also, the IRS does not appear to use traditional vehicle ratings for tax credits, and many vehicles that we would consider SUVs, do not.
The SUV (unless it’s an IRS) starts at $61,000. The Model Y Performance starts at $64,000.
What is the Tesla Model Y?
It’s an all-electric SUV that fills the gap between the Model 3 and the large, expensive Model X SUV. The Model Y in long-distance AWD trim has a range of 330 miles on a charge, while the base version has a range of 279 miles. With its two motors, the performance version can go from 0 to 60 mph in about 3.5 seconds, according to Tesla.
Although the Model Y has reigned supreme as the semi-luxury midsize SUV, Ford, Chevy, and Hyundai are all trailing after the segment. The new Hyundai Ionic 5, MotorBiscuit’s electric car of the year, features similar performance in a sleek package that costs nearly $20,000 less. The upcoming electric Chevrolet Blazer aims to steal some of its sales, too.
Elon Musk wants people to “please comment” on the Tesla Model Y tax credit issue
Of course, in a tweet, Elon Musk is now asking people to comment on the qualifications of the electric vehicle tax credit. Submit a link to the IRS Comments page.