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Congress May Give Tesla Buyers 400,000 More $7,000 Tax Credits

By Rich Smith - Feb 12, 2021 at 12:22PM

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And GM could cash in, too.

Once upon a time, federal income tax credits for car buyers buying electric cars -- ranging as high as $7,500 for a single car -- helped to make Tesla (TSLA 5.14%) the success story it has become.

However, because those credits phase out as a car manufacturer approaches 200,000 units sold -- and because Tesla has been so successful selling electric cars -- it's been more than a year since a Tesla customer booked a tax credit on a Model S, Model 3, Model X, or Model Y.  

Tesla Model X with gull wings open.

Image source: Tesla.

But that could soon change.

As electric-cars enthusiast Electrek reports today, Congressional Democrats have just introduced the Growing Renewable Energy and Efficiency Now (GREEN) Act for consideration. If passed, the bill would replenish electric-car company tax credits for an additional 400,000 units. Even a company like Tesla, or General Motors (GM 2.69%), which has also already sold too many cars for its customers to benefit from the old credits, would become eligible for a new batch of tax credits on electric-car purchases.

How much money are we talking about here? Seven-thousand dollars per car for cars numbers 200,000 through 600,000 sold.

Data from show that Tesla has sold 781,078 cars in the U.S. over the last five years. To not penalize the company for its success, therefore, the new law would not count the sales Tesla made prior to enactment of the new law. In other words, if the law is passed, buyers of the next 400,000 Teslas sold will have access to the $7,000 credit.

That's probably cold comfort to buyers who bought Teslas numbered 200,001 to 781,078. 

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