The plug-in versions of these models, however, do qualify. Tax credit for the purchase of a new plug-in electric drive motor vehicle. Family of 4 with no other tax credits except child tax credit. Paying taxes on $30k is going to cost you more not less than the $10k amount you paid taxes on for the roth IRA conversion. Say it triples in value by the time you retire and is worth $60k which you can spend tax free. Tags: Toyota, Toyota Rav4, Toyota RAV4 Prime. (They’re not too interested in the hydrogen fuel cell powered cars the company has been promoting for the past 5 years, either.) I'm pretty sick of all these motoring articles always going on about how affordable the rav4 prime is with the tax credit. If you consider that the MSRP of the regular hybrid RAV4 is $28,500, shelling out a few thousand more for a Prime might be worth it. Federal Tax Credits for New All-Electric and Plug-in Hybrid Vehicles Federal Tax Credit Up To $7,500! Though the initial cost places the RAV4 Prime at the top of the RAV4's model hierarchy, the Prime currently qualifies for a $7500 federal tax credit from Uncle Sam. Have a tip for CleanTechnica, want to advertise, or want to suggest a guest for our CleanTech Talk podcast? RAV4 Prime customers also may qualify for an $7,500 federal tax credit. Up to $10,000 in tax credits and rebates are potentially available for the Toyota RAV4 Prime. Why Are Tesla Vehicles Not Perfect? A Lexus NX or an Acura RDX or a Mazda CX5 Sky are basically the same price as a Rav4P and are by almost all measures worse cars. by Steve Hanley. SE AWD (Estimated Payment) $432 Monthly Payment. So how does the tax credit work? Most people just see it and automatically knock $7500 off MSRP. Published on July 1st, 2020 | 65k annual salary is solidly middle class. But remember the federal credit is not refundable. 72% Plugin Vehicle Market Share in the Netherlands! Now compare that situation with keeping the $20k in the 401k, having it triple in value to $60k, then paying taxes on the $30k gain. The Prime is also the most powerful Rav4, with a combined 302 hp when operating in hybrid mode. News is published on CleanTechnica.com, while reports are published on Future-Trends.CleanTechnica.com/Reports/ and buying guides are here. The most efficient and highest-performing RAV4 to date won't break the bank. Actually no. Just one month ago, we brought our readers news of an all new RAV4 Prime that broke with Toyota’s past practice. Reports in the Japanese media suggest Toyota simply failed to line up a large enough supply of batteries to meet the demand, even though all the batteries for the planned home market production of 4,000 vehicles would only require about 5.5 MWh of batteries — a very modest amount in today’s world in which battery factory output starts at 10 GWh and goes up sharply from there. Conversely, if you had 2 kids in college and got a $2500 credit for each of them and didn’t make a lot of money that year, you may not qualify for any of the EV credit. I guess your right, upper class starts at $72k for a single person. You still paid $7500 in taxes, so you would have enough for the full EV credit. In general, all electric vehicles can claim more of the credit than plug-in … Basically even though you paid the taxes earlier in the Roth conversion case, you paid less in taxes and that compensates. Advertise with CleanTechnica to get your company in front of millions of monthly readers. Steve Hanley Steve writes about the interface between technology and sustainability from his homes in Florida and Connecticut or anywhere else the Singularity may lead him. Cookies help us deliver our Services. And then in many states, including California, other incentives will make it decidedly more affordable. Nobody wants a car you have to plug in? The vehicle can also qualify for discounts from local utility companies as well as regional plug-in incentives like the $1,000 California Clean Vehicle Rebate. I change my mind and cancel the hybrid and tell them to keep the deposit for my RAV4 Prime purchase. Find the best Toyota RAV4 Prime discounts and current offers. In Q4, the RAV4 Prime’s second quarter of sales since its US launch, the pace was twice that of its first three months of sales. Federal Tax Credit. The 18.1 kWh batter capacity qualifies RAV4 Prime for up to the $7,500 federal tax credit and additional state in some states. It’s disgusting. It’s also eligible for a $7,500 federal tax credit. Keep in mind the Prime will be eligible for a $7,500 federal tax … This IRS tax credit can be worth anywhere from $2,500 to $7,500. While the new RAV4 Prime costs more than the standard hybrid model, buyers are eligible for a federal tax credit of $7,500. Unless you really want it, I would start saving today and hopefully by the time the credit starts to expire, maybe it'll be closer to your total liability and dealers may be more willing to negotiate on prices. A Tesla Model Y starts at 48k and at it's entry level price point is in most circumstances a worse car than the Rav4P. Advertised Lease Deals. Individual states have additional incentives that can be either be applied at time of purchase or via a rebate program, depending on the state. I'm pretty sick of all these motoring articles always going on about how affordable the rav4 prime is with the tax credit. CleanTechnica member, supporter, or ambassador, In Midst Of Insurrection, Texas Roots For Green Hydrogen Future. Go Get Car Price Change Alerts. Credit amount depends on the car's battery capacity. Search Local Cars for Sale . What other states have refundable ev/phv tax credits? If it’s over half of your income, I agree that’s not a which purchase. sort of defeats the purpose of the tax deferral. Great point about cost of vehicle versus income. I know some states have refundable tax credits like Colorado. You point out MSRP comparisons but how many of us can find the RAV4 Prime we want that isn’t marked up 10k over MSRP. View All. Sweet! We selected the Toyota RAV4 based on its proximity to the Toyota RAV4 Prime based on brand, size, and price. The 2021 RAV4 Prime, however, is eligible for a $7,500 federal tax credit. Corvettes and Mustangs are often called affordable because they compete with supercars. But remember the federal credit is not refundable. and an 18.1 kWh battery, which is large enough to qualify for the full $7,500 federal tax credit. But the Prime secures the federal government’s maximum plug-in tax credit, $7,500 for qualifying shoppers, to reduce its net starting price to just under $32,000. There is also a hint that Toyota is unsure of what tax credit programs will look like next year, but that is clearly an attempt by the company to cover up for its incompetence at the executive level. Inside EVs asks this highly pertinent question: “What is the problem, and why did it happen in times of general slowdown of car sales, when a surplus of manufacturing capacity over sales could be redirected towards plug-ins?”. However, if you only owed $6500 in taxes and were in line for a $1500 refund, you would only get $6500 of the EV credit. Press question mark to learn the rest of the keyboard shortcuts. With the 2021 Toyota RAV4 Prime, you get an estimated 600 miles of range and can drive for 46 miles in EV mode. RAV4 Prime availability will be even more limited when the full FIT credit is close to expiry. It also has an electric motor that pumps up total horsepower available under the driver’s right foot to 302. According to Toyota, at the purchase of your brand new Prime, you will be eligible for up to $7,500 in federal tax credit. It seems orders for the car have far exceeded Toyota’s plan to make a modest 4,000 examples of the RAV4 Prime for the home market this year. But you have to realize that it actually qualifies for the full $7,500 federal tax refund. Changing your withholdings doesn't change your tax liability. It has also spread the rumor that it’s better for the environment for it to build lots of “self charging” hybrids with wimpy little 1.8 kWh batteries rather than a few full battery electric cars because “battery supplies are limited” and lots of cars with tiny batteries are a better use of scarce resources. Toyota. Just as an example, say you have a 401k with 20k balance, of which 10k is gains. Browse the latest 2021 Toyota RAV4 Prime deals, incentives, and rebates in your area at Edmunds.com. In some places, the vehicle may … As with other Toyota hybrids, the RAV4 Prime comes with a continuously variable automatic transmission (CVT). It's all perspective, we are a family of 5 comfortably living off 58k a year in Colorado. The 2021 Toyota RAV4 Prime unveiled and on display | FREDERIC J. BROWN/AFP via Getty Images. Please select a model. Lower middle class in expensive localities. Reddit's original Toyota RAV4 Prime discussion community. The company you save could be your own. Actually, curb your enthusiasm there, pardner. Due at signing: $3,082. New Car Quick Quote. Personalize Incentives. No, because it's based on liability. (Smarten up, guys.) Press J to jump to the feed. One suspects the big bosses at Toyota simply didn’t believe the car would sell well and failed to arrange for an adequate supply of batteries. Prices for the 2021 RAV4 Prime officially start at $39,220 with destination, although a $7,500 tax credit can help drive down the cost depending on your eligibility. ), Low-Cost, Cobalt-Free Batteries Coming From Panasonic In 2–3 Years, Just One Year Later, Sony Vision-S Electric Car Hits The Road. If you are buying a car worth more than 50% of your salary, you really can't afford it. Then when you do your taxes in April you find out you get a $500 refund (not taking any EV credit into consideration). $7,500. The car itself is between $38k-48k sticker. Contact us here. Family of 4 making $114k is hardly “rich”, especially in CA or NY. You convert it to a roth IRA, effectively pay $10k in taxes, and then have $20k grow tax free. In both of these examples, if you used the EV credit, you'd be getting back $8000 at tax time (overpayment amount + EV credit). And the Rav4P is affordable by comparison. Hitssquad is correct, the EV credit goes against the tax you owe for the year. Individual state incentive information can be found at At the same price point, the Y seems way better unless you're often taking really long roadtrips. Hogwash. Honestly, the way I see it is that if you can not afford to get the full tax credit, the car is likely too expensive for you. Find 2021 Toyota listings for sale near you. Where do we sign up? What makes it more attractive is that it’s standard with all-wheel drive. Personally I’m just frustrated with Toyota for pulling this stunt. Searching Locally. Get Your Price. Toyota has priced the 2021 RAV4 Prime at $38,100 for the SE trim and $41,425 for the XSE trim. The amount is determined by the power storage of the battery. On top of this, the 2021 RAV4 Prime is eligible for up to a $7,500 tax credit from the IRS. And about $65,000 a year for a single person. Family of 4 with no other tax credits except child tax credit. Just 3 weeks after the start of production for the RAV4 Prime, Toyota has announced it won’t build any more for a while. I think you could be cherry picking on features also, you don’t mention how Model Y is faster, will most surely have a better safety rating, doesn’t have an extreme breaking distance like the Prime, and has better tech. Combining the California and federal credits, you could get up to $10,000 off the 2021 RAV4 Prime. Consider becoming a CleanTechnica member, supporter, or ambassador — or a patron on Patreon. Search car listings & find the right car for you Click here for 2021 Toyota RAV4 Prime SE local listings. Knock $ 7500 credit Toyota for pulling this stunt conversion case, you really ca n't afford it.push {! For pulling this stunt basically even though you paid less in taxes, so you would have for! Drive for 46 miles in EV mode electric motor that pumps up total horsepower available the... Conversion case, you could get up to $ 10,000 off the 2021 Toyota Prime! 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