GM hits phase-out trigger for plug-in vehicles tax credit

Big Three automaker General Motors has sold more than 200,000 cars that are eligible for the plug-in electric drive motor vehicle credit during the fourth quarter of 2018, triggering a phase out of the credit for taxpayers of new GM plug-ins beginning April 1, according to the IRS.

The service said that qualifying vehicles by the manufacturer are eligible for a $7,500 credit before April 1. Starting on that date, the credit will be $3,750 for General Motors’ eligible vehicles.

On Oct. 1, 2019, the credit will be reduced to $1,875 for the next two quarters. After March 31, 2020, no credit will be available.

The badge for a General Motors Co. (GM) Chevrolet brand Bolt EV electric vehicle is displayed at the Stewart Chevrolet dealership in Colma, California, U.S., on Monday, Feb. 6, 2017. General Motors is scheduled to release earnings figures on Feb. 7. Photographer: David Paul Morris/Bloomberg
The badge for a General Motors Co. (GM) Chevrolet brand Bolt EV electric vehicle is displayed at the Stewart Chevrolet dealership in Colma, California, U.S., on Monday, Feb. 6, 2017. General Motors is scheduled to release earnings figures on Feb. 7. Photographer: David Paul Morris/Bloomberg

The plug-in credit was enacted in the Energy Improvement and Extension Act of 2008 and subsequently modified in later law. It provides a credit for eligible passenger vehicles and light trucks. By law, five quarters after a manufacturer reaches the sales threshold, the credit ends for its vehicles.

Rival electric carmaker Tesla reached a similar phase-out after sales in the third quarter of 2018.

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