Washington State EV Sales Tax Exemption - Bill Introduced

[PNWLeccy]

Hello. Did you confirm that the threshold is the new car price and not the net of trade?

Alternative Fuels Data Center: Retail Sales Tax Exemption
Clean alternative fuel and plug-in hybrid vehicles - sales/use tax exemptions | Washington Department of Revenue
"Vehicles must not have a selling price plus trade-in property value that exceeds $45,000 for new vehicles and $30,000 for used vehicles."

 

[acarney]

Hello. Did you confirm that the threshold is the new car price and not the net of trade?

I don’t have a trade so I wasn’t specifically asking about that, but I do believe the bill spells out that it’s the price of the new car regardless if you have a trade or not.

Just sat on hold for 10-15 min with WA DOR and it sounds like they have the same bill to read and no additional info at this point. The rep spoke with a couple other people and they all seemed to point to sticker price as being the qualifier. So for WA it sounds like if the doc/destination fee is listed on a “sticker price” then it would have to all be under $45k to qualify. I assume this would be roughly equal to the purchase agreement that you’re sent immediately after ordering the Model 3. The one that shows line item upgrades and doc/destination fee and the total, but doesn’t NOT calculate in the tax and state fees yet.

So it looks like SR/SR+ only; looks like you could max out a SR+ (red/white/19s) and still qualify but even the cheapest SR+ with FSD wouldn’t qualify. So I guess order and take delivery as soon as possible (but after Aug 1st), and the upgrade to FSD after delivery but before the price increase middle of August.

 

[PNWLeccy]

So since it is a sales tax exemption, wouldn't this be handled by Tesla at the time of sale/on delivery? It's not a federal tax credit where a refund needs to be requested, but rather a direct cut in the calculated sales tax due when purchasing.

In other words, I would expect this to be calculated by Tesla when you purchase even though they don't seem to be certain about the rules either right now.

Can anyone with a similar state sales tax exemption chime in with how this was handled?

 

[Yeab Wondimu]

So since it is a sales tax exemption, wouldn't this be handled by Tesla at the time of sale/on delivery? It's not a federal tax credit where a refund needs to be requested, but rather a direct cut in the calculated sales tax due when purchasing.

In other words, I would expect this to be calculated by Tesla when you purchase even though they don't seem to be certain about the rules either right now.

Can anyone with a similar state sales tax exemption chime in with how this was handled?

I haven't taken delivery of my M3 yet but I was told by the Tesla rep that they handle everything on their end and that I should see the credit reflected on the MVPA that they send to my lender and the final paperwork that I sign before taking delivery.

My understanding is that the credit is also based on the sticker price of the car not including fees.

 

[PNWLeccy]

I don’t have a trade so I wasn’t specifically asking about that, but I do believe the bill spells out that it’s the price of the new car regardless if you have a trade or not.

Just sat on hold for 10-15 min with WA DOR and it sounds like they have the same bill to read and no additional info at this point. The rep spoke with a couple other people and they all seemed to point to sticker price as being the qualifier. So for WA it sounds like if the doc/destination fee is listed on a “sticker price” then it would have to all be under $45k to qualify. I assume this would be roughly equal to the purchase agreement that you’re sent immediately after ordering the Model 3. The one that shows line item upgrades and doc/destination fee and the total, but doesn’t NOT calculate in the tax and state fees yet.

So it looks like SR/SR+ only; looks like you could max out a SR+ (red/white/19s) and still qualify but even the cheapest SR+ with FSD wouldn’t qualify. So I guess order and take delivery as soon as possible (but after Aug 1st), and the upgrade to FSD after delivery but before the price increase middle of August.

I also gave WA DOR a call today and the lady just told me that they had no more information at the moment but that they would be releasing more details come 8/1.

 

[acarney]

Looks like they’ve updated the web site (though not the list of approved vehicles since they still only show 2017-2018 Model 3 )

On August 1, 2019, the sales and use tax exemption was reinstated for the sales of:

• vehicles powered by a clean alternative fuel
• certain plug-in hybrids

The exemption applies to dealer and private sales of new, used, and leased vehicles sold on or after August 1, 2019.

• New vehicle transactions must not exceed $45,000in price or lease payments.
• Used vehicles transactions must not exceed $30,000 in price or lease payments.

These price thresholds include both the cost of the vehicle and the value of your trade-in, if applicable.

For example: If the cost of a new vehicle is $48,000, and the value of your trade-in is worth $6,000, you can't receive the tax exemption. Even though the trade-in brought the cost down to $42,000, the new vehicle was still worth over the $45,000 limit. You cannot use a trade-in to lower the price of a vehicle to meet the exemption limits.

Again somewhat vague language, but looks like they’re clearly trying to say if you’re writing a check for more than $45k, you don’t qualify. I’m taking this as all upgrades (paint, FSD, etc) AND doc/destination fee as needing to be included in that $45k limit.

Curious now how quick Tesla’s system will be updated now to apply the point of sale exemption.

 

[PNWLeccy]

Just to clarify for all those who have been following this saga re: if doc/dest fees count towards the $45k limit.... I have confirmed today with 2 representatives in Seattle and Bellevue that the fees DO NOT count towards this cap. They said that it has been cleared by Legal and that they were not advising this earlier because they weren't sure.

He even gave me the example that the SR+ with FSD can now sneak under the limit by $10 at $44,990 but they had been advising people against including FSD before because they weren't sure.

My pursuit of a LR inventory <$45k continues!

 

[acarney]

Just to clarify for all those who have been following this saga re: if doc/dest fees count towards the $45k limit.... I have confirmed today with 2 representatives in Seattle and Bellevue that the fees DO NOT count towards this cap. They said that it has been cleared by Legal and that they were not advising this earlier because they weren't sure.

He even gave me the example that the SR+ with FSD can now sneak under the limit by $10 at $44,990 but they had been advising people against including FSD before because they weren't sure.

My pursuit of a LR inventory <$45k continues!

FUUUUU*********** >.<

That could have opened up my hunt for a LR option a lot too! I’m not sure if I had found one that was $45k or less, but it’s a heck of a lot easier...

 

[PNWLeccy]

FUUUUU*********** >.<

That could have opened up my hunt for a LR option a lot too! I’m not sure if I had found one that was $45k or less, but it’s a heck of a lot easier...

Was thinking about you when I found this out. I had one for $44k that i turned down because I wasn't too keen on it being red but kinda kicking myself for doing it now since my OA has described it as a "bit of a unicorn".

I'll wait until end of Q3 and see if anything pops up but may end up in a SR+ anyways. Not sure yet

 

[acarney]

Was thinking about you when I found this out. I had one for $44k that i turned down because I wasn't too keen on it being red but kinda kicking myself for doing it now since my OA has described it as a "bit of a unicorn".

I'll wait until end of Q3 and see if anything pops up but may end up in a SR+ anyways. Not sure yet

I think the best my guy found was $46k before destination, but that was early in the hunt. After that I really limited him to only stuff at $43.8k or less, which really tied his hands. There might have been something out there for $45k...

I’m tempted to text him again and ask for one last look, but I feel like I’m a HUUUUGE pain in the butt for him... and he doesn’t even work at the store I ordered from. (Actually ran across him online when he was just answering a couple questions I had.)

 

[PNWLeccy]

I think the best my guy found was $46k before destination, but that was early in the hunt. After that I really limited him to only stuff at $43.8k or less, which really tied his hands. There might have been something out there for $45k...

I’m tempted to text him again and ask for one last look, but I feel like I’m a HUUUUGE pain in the butt for him... and he doesn’t even work at the store I ordered from. (Actually ran across him online when he was just answering a couple questions I had.)

Yea to be honest, from my experience, there’s a huge drought of good inventory deals for the last 1-2 weeks. Everyone I’ve talked to has commented about how they aren’t seeing anything at all right now so that’s why I’m hoping something could come up at the end of the quarter. I think it’s a long shot at best but I’m willing to wait because I don’t NEED it right now.

The test drive sure has made it harder to wait though...