US government implements new hurdles to receive electric vehicle tax credit

CHICAGO - Just like the sound of an electric car engine, the U.S. government quietly implemented new hurdles to receive an electric vehicle tax credit.

"The biggest drawback is the domestic content requirement and the income caps on people who want to buy the electric cars," said John McElroy, host of Autoline TV.

Now, only certain vehicles qualify, namely those manufactured, battery parts and all, in the U.S.

"GM, Ford and Stellantis, and Tesla, and a few others do that, but most of the companies from Europe, Japan and Korea don't qualify," said McElroy.

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Car brands that will be losing access to the U.S. EV tax credit include Audi, BMW, Genesis, Nissan, Rivian, Volkswagen, Volvo, Kia and Hyundai. But there’s a very important loophole.

"If you lease an EV.  Not buy it, but lease it, just about everything qualifies," said McElroy.

The goal of the new regulations are to force automakers to put EV battery and manufacturing companies in the U.S. and it seems to be working.

"This legislation has kicked off a mad scramble, all the foreign automakers are racing to start moving production to the United States right now," added McElroy.

To qualify for the credit, individual tax filers must make less than $150,000 and joint filers less than $300,000.