I’ve been negotiating with a dealership, and they initially agreed to a deal I was pretty happy with.
My AGI last year was over the $150,000 limit to qualify for the tax credit since I filed as single. However, my wife and I will file jointly this year, and we’re well under the $300,000 threshold for joint filers.
After spending a lot of time with this dealer, they’re now saying it’s their policy to use last year’s AGI to approve the point of sale rebate and are refusing to apply it. They claim they’d be liable for the $7500 if I didn’t qualify, which I find hard to believe. Everything I’ve read says that if a buyer doesn’t qualify, the IRS will come after the buyer, not the dealer.
Their logic doesn’t add up because, by that thinking, they’d also be liable if a buyer got a raise after purchasing the vehicle. Has anyone else dealt with this? I’m starting to think they’re using this as a tactic to back out of the deal.
Why not just buy the truck if the deal is good and claim the credit yourself at tax time? Not ideal, but you get the car you want, a good deal, and you’ll still get the tax credit.
Reeve said:
Why not just buy the truck if the deal is good and claim the credit yourself at tax time? Not ideal, but you get the car you want, a good deal, and you’ll still get the tax credit.
True, with the 0% financing incentive, I might just go for it. The dealer’s MSRP was $75,140, and I got them to commit to $60,000 out the door, a 7.51% discount. I have another option from a different dealer, but it’s a slightly lower discount at 4.86%. Still, I’m getting the truck this week either way.
@Vienna
Dealers are getting around $20k from Ford to sell the Lightning. Without the Z Plan invoice, it’s hard to know their actual cost. And if you’re using Ford financing, they get another kickback, so don’t feel like you’re robbing them.
Reeve said:
Why not just buy the truck if the deal is good and claim the credit yourself at tax time? Not ideal, but you get the car you want, a good deal, and you’ll still get the tax credit.
If you’re in a state like California, where they tax the credit at the sale, it’s actually better to claim it later on your own.
Tell the dealer they need to get a decent accountant. According to IRS guidelines, if a taxpayer’s AGI ends up over the limit, it’s the taxpayer, not the dealer, who’s responsible for paying the credit back.
My understanding is that the taxpayer, not the dealer, is responsible if you end up not qualifying. You could try showing them the IRS guidelines, but it sounds like they’re just trying to make things difficult.
That’s pretty annoying. My dealer didn’t ask about my income; they just had me sign a form saying I was eligible to transfer the credit to them. My understanding is they’d get the credit immediately, and if I end up not qualifying, it’d be on me to pay it back.
Oli said:
If the dealer’s giving you trouble, just walk away unless the deal is unbeatable.
I walked and got the same price from a different dealer, and they’re fine with doing the rebate at the point of sale. It’s just 30 minutes farther for me, so I’m glad to keep my monthly payment where I wanted with the planned down payment.