congress changed the rules governing electric car tax credits over the summer but the changes didn’t immediately take effect some will kick in soon while others will taper in over time the evolving rules mean that the best time to buy an electric vehicle depends on everything from which car you want to your current income we’ll break it down for you what has changed what will change before congress passed the inflation reduction act in august federal ev tax credits were reasonably easy to understand buyers could claim a credit of up to 7500 if they bought one of the first 200000 evs or plugin hybrid vehicles phevs a manufacturer built once a manufacturer hit that cap the credit phased out over the remaining year two manufacturers general motors gm and tesla tsla  had exceeded the cap buyers couldn’t qualify for a credit when buying one of their cars another toyota tm crossed it during 2022 meaning buyers could still be eligible for part of the credit no other manufacturer had hit the cap so all evs and phevs from other manufacturers qualify today learn more what is ev bev hev phev here’s your guide to types of electric cars the act changes the rules radically broadly it eliminates the manufacturer cap and introduces income and price limits instead that means buyers can again qualify for the credit when buying a gm tesla or toyota product but only if they fall under income limits and the car falls under price caps those rules take effect on jan 1 2023 some vehicles that don’t qualify for a credit on dec 31 will be eligible on jan 1 chiefly those made by gm and tesla only individuals reporting adjusted gross incomes of 150000 or less qualify for the discounts the limit moves to 225000 for those filing as head of household and 300000 for joint filers the law also introduces price caps the discount now applies only to cars priced under 55000 and trucks and suvs priced under 80000 that rules out many tesla products only the leastexpensive version of its model 3 sedan the model 3 standard range sneaks in under the price cap every tesla model y suv qualifies no model s or model x makes it in under the price cap congress aimed the new regulations at getting more americans into electric cars to cut greenhouse gas emissions but it has other aims too lawmakers designed the act to boost north american manufacturing only evs assembled in north america qualify for the credit that rules out some popular models like the hyundai ioniq 5 2022 north american car of the year built in south korea read 3 reasons the hyundai ioniq 6 makes the tesla model 3 seem a bit boring it can be challenging to determine precisely where the manufacturer built a car some manufacturers make the same cars in several countries and ship them around the globe the only way to be sure is to get the vehicle identification number vin of the car you want to buy and input it into the us department of energy’s vin decoder see these cars are the most ‘made in america’ the act also phases in a set of rules requiring manufacturers to mine critical battery components in the us or from major trade partners those rules don’t kick in until 2024 so you don’t need to factor them into your buying decision today automakers are working to adjust their supply chains to meet the requirements but according to the alliance for automotive innovation a major industry trade group no electric car could meet the battery sourcing requirements today tesla is offering a discount to shop before jan 1 many tesla shoppers have figured out that their car will qualify for a tax rebate if they wait to buy so many that it may be causing problems for the company tesla reports delivery figures quarterly the company has had a rough quarter with its stock price falling dramatically after ceo elon musk began devoting much of his time to running twitter there are signs it’s worried about an artificially low delivery number in its fourth quarter results because of all the customerrequested late deliveries tesla rarely discounts its cars but in december it’s offering a discount of 3750 on every model 3 and model y if customers agree to take delivery in 2022 for some buyers waiting for the tax rebate in january is still the best move but if you plan to buy a tesla and your income will keep you from qualifying for the tax incentive you could see a lower price by buying now one last component of the law might affect your decision before and after jan 1 2023 the rules allow you to take the 7500 discount as a credit on your taxes on jan 1 2024 dealers will be allowed to offer it as an upfront discount instead waiting another year might make sense for buyers who can’t easily afford to float the 7500 until tax time putting it all together so if you’re shopping for an electric vehicle when should you buy it if you want a gm tesla or toyota product you won’t be eligible for the 7500 tax credit in 2022 you might be eligible in 2023 if your income and the car’s price both fit under the new caps in that case you should wait if you’re buying a tesla model 3 or model y however and either your income or the car’s price means it won’t qualify act now and take tesla’s discount offer see the 2023 kia ev6 is more than 17000 cheaper than the tesla model y how do they compare if you want to buy an ev from another manufacturer you might be better off acting before jan 1 income and price caps won’t affect your purchase then and many cars that qualify under the old rules won’t be eligible under the new ones because of where they build them