Most highly anticipated products like iPhones or gaming consoles end up for a premium on eBay if the supply does not keep up with the demand. Think that will be the case with the Model 3?
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If you are one of the lucky ones to get the $7500 tax rebate you won't want to flip as this could legally effect you eligibility for the rebate.
The vehicles must be acquired for use or lease and not for resale. Additionally, the original use of the vehicle must commence with the taxpayer and the vehicle must be used predominantly in the United States. For purposes of the 30D credit, a vehicle is not considered acquired prior to the time when title to the vehicle passes to the taxpayer under state law.
He is talking about this part: "The vehicles must be acquired for use or lease and not for resale." If you buy it to flip, you are clearly acquiring it for resale. While there is no holding period, that seems to violate the provision. No idea if IRS had ever enforced this.How could it affect you legally?
From the IRS:
If you buy the car, have it delivered, title it in your name, drive it for a day and decide to sell it the next day, seems that you are eligible. There doesn't seem to be a holding period.
He is talking about this part: "The vehicles must be acquired for use or lease and not for resale." If you buy it to flip, you are clearly acquiring it for resale. While there is no holding period, that seems to violate the provision. No idea if IRS had ever enforced this.
I bought it
Registered it.
Drove it.
Realized I don't like it as much as I thought or wanted to buy a pony instead or I bought it for my wife as a surprise who didn't like it since the frunk wasn't to her liking.
Advertised it for sale the next day.
Still owe the IRS 100% of the credit back.
See 26 CFR 1.30-1 (b) (4) and 26 CFR 1.30-1 (b) (5)
I'm sure that some people out of the 275k or so reservation holders (give or take a few k depending on how many cars each person reserved) will attempt to flip their Model 3, but I suspect the vast majority won't flip.
Why give up the opportunity to experience ownership of a historic, game changing automobile? I like making money too, but what's the point of money if you can't have fun with it sometimes?
If people have money to speculate on a Model 3 and think it will be that hot, they might as well invest in TSLA. I'm sure that anyone who put down 40k on a Model X Signature with intent to flip is now sorry they tried to flip rather than invest in the company stock.
Many probably may not get it but I'm sure there are a few considering doing that for whatever is worth for them.You also don't get the federal tax credit (in the US) if you flip so that will play a big factor in this.
The next line is: knocked 10% for depreciation ..Yeah. But there is no way to prove that it was bought for resale unless you advertise it before you own it.
I bought it
Registered it.
Drove it.
If I go through with the purchase, I intend it as my daily driver.
How could it affect you legally?
From the IRS:
If you buy the car, have it delivered, title it in your name, drive it for a day and decide to sell it the next day, seems that you are eligible. There doesn't seem to be a holding period.