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Act fast -- tax credits for GM electric cars are disappearing

Roadshow logo Roadshow 10/1/2019 Roadshow staff
a car parked on the side of a road: Buyers can only take $1,875 off an electric car from GM now. Chevrolet© Provided by CBS Interactive Inc. Buyers can only take $1,875 off an electric car from GM now. Chevrolet

Substantial federal tax credits have undoubtedly made electric vehicles more appealing, reducing their often steep price tags and helping manufacturers deliver more clean-running, battery-operated models.

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Unfortunately for car companies, Uncle Sam's generous remittances won't last forever, and General Motors' share of the handouts are getting significantly smaller starting today.

Late in March, everyone's favorite governmental agency, the Internal Revenue Service, posted that GM had sold more than 200,000 vehicles eligible for this tax credit. After that point the discount, which tops out at $7,500, starts to rapidly decline.

Models that quality for said rebate must have four wheels and a gross vehicle weight rating (GVWR) of less than 14,000 pounds, must draw energy from a battery pack with a capacity of at least 4 kilowatt hours, and be recharged from an external source. In short, this includes EVs like the Chevy Bolt hatchback.

But since The General has crossed that 200,000-unit threshold, starting on April 1 of this year the available maximum tax credit got cut in half, to a much-less-appealing $3,750. Continuing a downward spiral, starting today that figure falls by another 50 percent. Customers shopping for an eligible GM electric vehicle will only receive a federal credit up to $1,875, and that's only going to be available for the next two quarters. After March 31, 2020 no government discounts will be offered.

So, if you want to drive home in a new GM EV, you'd better make a move sooner rather than later if you don't fancy paying full price.

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