Second-hand price higher than new price?

[Dan5]

Yeah, think if someone offered me 150 K for my Model S, I'd take the 50 K profit and wait a few months to get another one. Less than that, probably not. I'd buy the same car again and then another one of lesser performance ( 40 kw or 60 kw) for my parents.
I don't think anyone would pay a 50 K premium for my reservation number, it's in the 1,800's, but I'm sure I'll get offers once I get the car (will not take one even if it's 149,999.99).

 

[EVNow]

How will the IRS know if you subsequently sell the car?

And what's the cutoff? 1 week, 1 month, 3months, 6 months?

Obviously, you can claim any credit you want. You would get into trouble only if you are audited ...

Back on topic, the used price depends on
- How many Orphans are around for sale, and what is Tesla policy on selling them. Unlike Nissan dealers, Tesla may give the orphan to the next person in the queue with exactly the same options. Or they may auction on e-bay.
- The waiting period

Currently, for eg., used Leaf has been sold around $23k (the last I checked). This is nearly the new price after tax credits & CA rebate. The orphans are no longer going for a premium in CA - but they are still at a premium some other places. I saw one sold for $5k premium a couple of months ago.

 

[smorgasbord]

Double checking, the two week transfer allowance to a 2nd owner only applies to a lease payoff. If two separate buyers are involved, and two sales have ocurred then all the paperwork must be submitted at the same time (no two week allowance) and only one tax will be due. Reference: I called AAA

That's interesting, but then what happens with the $7500 Federal Tax credit?

 

[SigGuy]

The tax credit issue is interesting. It says the car can't be "purchased for resale"... but even if audited can't you say "I bought it and didn't like it so I sold it". I mean jeez, I never even got to test drive the thing! How can the IRS know what your intention was when you bought it? What's the "appropriate" waiting period before selling it? I'm pretty sure that if you take title and pay the tax, you're welcome to sell it the next day and still claim the tax credit. Anybody have reason to believe otherwise?

 

[Lloyd]

My take would be that neither gets it, although you may try. You certify that you are buying it "not for resale" and the 2nd owner does not qualify, and does not have the paperwork from the manufacturer.

 

[SigGuy]

I think that it's clear the 2nd owner will not get it. But why wouldn't the first? Again, how would the IRS know your intention when you bought it? What if you kept it for... 3 weeks? 2 months? Especially given it's newness and lack of test drives, why can't you have bought it for yourself and immediately changed your mind? And how can they prove otherwise?

 

[EVNow]

Especially given it's newness and lack of test drives, why can't you have bought it for yourself and immediately changed your mind? And how can they prove otherwise?

I don't know where the burden of prood is in this case - a chat with a tax consultant would be useful. BTW, you might want to check in MNL about this - several people including some lawyers (IIRC) weighed in, last time this came up.

 

[Sig698]

I don't think anyone will be getting $150k offers for their new Model S, but it should be easy to recover your initial investment without any problems at all, and probably make a little extra on top. This seems to happen with many wait listed cars; when the Smart car still had a 1 year waiting list, people were offering $18-$20k for a car that cost $14k new.

 

[brianman]

Regarding the reselling and tax credit it...
Worst case: Buy in 2012. Sell on Jan 1, 2013. Taxes are resolved at that point.

 

[onlinespending]

Regarding the reselling and tax credit it...
Worst case: Buy in 2012. Sell on Jan 1, 2013. Taxes are resolved at that point.

i was thinking the same thing, though you've lost a lot of your leverage reselling it that late. out of curiosity, how long is the tax credit good for? is it only through 2012 unless Congress extends it? the reason I ask is, imagine you're unsure whether Tesla will be able to deliver your car by the end of 2012 given your reservation spot and desired configuration, and you're also concerned the federal tax credit (or some other state tax benefit) will not be extended for 2013. this could prompt some to upgrade to a larger battery pack in the hopes of ensuring delivery in 2012 in order to qualify for the credit. i also wonder if you could complete the sale in 2012 even if you won't be receiving it until early 2013. i can't see why Tesla would refuse your money earlier than delivery as it only benefits them.

 

[ERAS3R]

I purchased a Volt while I wait for the Model S. I am claiming the $7,500 deduction this year and will probably take delivery of the Model S in July (Res #684). Anyone knows if I can claim another deduction?

 

[dsm363]

i was thinking the same thing, though you've lost a lot of your leverage reselling it that late. out of curiosity, how long is the tax credit good for? is it only through 2012 unless Congress extends it? the reason I ask is, imagine you're unsure whether Tesla will be able to deliver your car by the end of 2012 given your reservation spot and desired configuration, and you're also concerned the federal tax credit (or some other state tax benefit) will not be extended for 2013. this could prompt some to upgrade to a larger battery pack in the hopes of ensuring delivery in 2012 in order to qualify for the credit. i also wonder if you could complete the sale in 2012 even if you won't be receiving it until early 2013. i can't see why Tesla would refuse your money earlier than delivery as it only benefits them.

The tax credit is for the first 200,000 cars from each automaker that are EVs.

 

[neroden]

Federal Tax rebate only applies if the car was not purchased for resale.

If you purchase it and then change your mind and resell it, it was not "purchased for resale", so anyone who wants the tax credit, don't admit that you're planning to resell it until after you've taken delivery and driven it for a day. :wink: Which may well eliminate the ability to use the "dual transfer" ability in the California tax code...

CA state tax rebate only applies if the car stays in CA.

Which means at least a year. Does that one have a clawback provision if you sell it after that point?

Don't forget, depending on your state's vehicle sales tax laws, the second purchaser may be paying sales tax twice.

Hell yeah, and the state will be very pleased to collect that.

And, that's all before the original purchaser's profit is factored in. In CA I figure the second purchaser needs to spend about $15K more.

 

[TEG]

Which means at least a year. Does that one have a clawback provision if you sell it after that point?

http://www.arb.ca.gov/msprog/aqip/cvrp/final_fy1112_cvrp_manual_120111.pdf

...owned and leased vehicles must be operated and registered in California for a minimum of 36 consecutive months...

If it gets re-registered out of state within 3 years of the time you got the credit, then CCSE/CARB could come looking for a refund. Also, I heard they do follow up and re-check registrations to make sure the vehicle does stay in state.

You are expected to tell them if you sell it:

...Notify CCSE if the vehicle is sold or the lease is terminated within the 36 month period after the date of purchase or lease....

...vehicle purchasers and lessees participating in the CVRP are required to keep the vehicle and meet all applicable project requirements for a minimum 36 month period after the vehicle purchase or lease date. If a vehicle purchaser or lessee sells or returns to the dealer the rebated vehicle, ARB or its designee reserves the right to recoup all or part of the original rebate amount from the original vehicle purchaser identified on the rebate form and may pursue other remedies available under the law. However, resale of a vehicle or return to a dealer is allowed within this 36 month period if necessitated by unforeseen or unavoidable circumstances. To employ this provision, ARB must approve the circumstances and sale or return in advance. If the vehicle is resold, the vehicle purchaser or lessee must refund a prorated portion of their rebate, in an amount equivalent to the original rebate amount divided by 36 months and then multiplied by the number of months remaining in the original 36 month period (rounded to the nearest month),...