In August, President Biden signed off on a new Federal EV tax credit that will incentivize people to switch to electric vehicles from gas-powered ones. The new federal tax credit is a part of the Inflation Reduction act (IRA) which is poised to make greener energy more affordable to everyday people. This new tax credit is just one of many steps that the Biden administration is taking in their bid to combat climate change and get America to carbon net zero.
The Inflation Reduction Act
The Federal EV tax credit scheme will give buyers up to $7,500 off of a brand-new electric vehicle. In today’s market, that is a significant saving for any consumer. The main criteria that the vehicle has to meet include the price of the electric vehicle to be under $80,000. In addition, the critical material, like the battery involved in the construction of the car, has to be from America or one of America’s free trade partners. This aspect is included to help boost American vehicle manufacturing. If the pandemic has taught us anything, it is to rely more on your own resources than to outsource everything.
Also, when the Inflation Reduction Act was signed in August, every electric car manufacturer was given a 200,000 limit on the number of cars they could sell under this new legislation. This section of the bill has since been revised, and from January 2023, the limit has been removed. Due to this limit still being in place, some consumers must wait until January to purchase some models if they want to use the tax credit.
The Best Pick of Electric Vehicles with the new federal tax credit
Electric vehicles are rapidly expanding, and all major car brands are now releasing both hybrid and electric cars, but below are some of the top picks.
Ford F-150 Lightning
Ford F-150 Lightning is the sole full-sized electric pickup on the market. It needs no introduction, as its gas-powered version has been a best-seller for Ford for years. The electric model uses a dual electric motor to give it four-wheel drive and has up to 452 horsepower.
It should satisfy any Ford truck fan as it still has plenty of power. It can go from 0 to 60mph in 3.8 seconds. Due to supply issues, Ford has had to increase the price from just over $40,000 to more than $50,000. Still, it’s a bargain and still eligible for the tax credits, which makes this an overall great buy.
Tesla Model 3 and Model Y
Tesla’s Model 3 and Model Y are the manufacturers newest release. The electric car giant is also very well known. Some can argue any car from the American automaker is a great choice. It has staggering power and excellent agility. It is slower than the Ford F-150 completing 0 to 60mph in 5.8 seconds for the standard Model 3.
Unfortunately, anyone who wants one of these and avail of the tax credits must wait until January. Tesla has already hit their limit. Something else to note, if you want to utilize the tax credit on this purchase, you will have to buy the car without the self-driving mode, as that will bring it above the $80,000 limit.
Lastly, while Nissan Leaf doesn’t set any records for being the most exciting car, it is definitely a safe choice. Nissan has built an excellent electric car with 148 bhp, and it can go from 0-60mph in 7.9 seconds. It is inexpensive to buy and has small running annual costs. It is a safe family alternative to a gas-powered saloon, and you can buy one this year as Nissan hasn’t reached their cap on the tax credits.
New Releases of Electric Vehicles
In 2023, several new models of electric cars will also be released, with many of them being showcased right now to stir up interest, but no truck is keeping everyone in suspense like the Tesla Cybertruck. This truck is designed out of something from Mad Max, but it is certain to be another sell-out for Tesla. An exact date has yet to be released. However, Elon Musk did confirm it will be coming out next year as production is set to start in December.
The good news for consumers is that it comes with an unbelievably low price tag of $40,000. That is even less than the affordable Ford E-150 Lightning. This price tag also makes it eligible for the Federal tax credits, bringing the price even lower.
Electric cars are the future of the automotive industry, with all governments and car manufacturers backing their manufacturing and selling. Many countries worldwide plan to ban the sale of gas-powered cars by 2035, so for all the gas-powered car enthusiasts, you have thirteen years to get on board with the electric car revolution.