How save thousands stacking Trump's new tax credits for cars with Biden's
Consider how each president's signature piece of legislation could help you save on a new car:
◾ 2022 Inflation Reduction Act: The Biden-era incentive gives you up to a $7,500 tax credit for new, plug-in EVs or fuel-cell electric vehicles. Trump's massive tax and spending policy bill will end this credit as early as Sept. 30.
◾ 'Big Beautiful Bill': Trump's new law offers an annual tax credit of up to a $10,000 on the interest of loans for new vehicles as long as they're less than 14,000 pounds and assembled in the United States. It covers purchases made in 2025 through 2028.
How long Biden's and Trump's tax credits for new cars last
More: What new version of Trump's 'Big, Beautiful Bill' could mean for EV car buyers and automakers
How to stack the auto tax credits
Here's how combining Biden's and Trump's tax credits over the next four years could save you a hunk of money on an EV:
A new EV might not be the best investment
To be sure, this strategy might not be the best way to stretch your dollar. But perhaps you're set on purchasing a new EV with the latest gadgets and upgrades.
The average price paid for a new EV this year has been $57,734, according to Kelley Blue Book. Even with the $7,500 tax credit, the EV premium over a gas-powered car is about $1,500. The math tips in favor of EVs when you look at the five-year fuel costs: $9,490 for gas-powered vs. $4,295, according to Kelley Blue Book.
If you can live without the new-car smell, used EVs' average listing price this year is about $20,000 less than for new models, according to Kelley Blue Book. You can also get a $4,000 tax credit from Biden's legislation for a used EV, but that wouldn't qualify you for the Trump tax credit.
Some additional fine print to consider if you use either of these tax credits
◾ Big Beautiful Bill: The tax credit for auto loans phases out for incomes between $100,000 and $150,000 for an individual and between $200,000 and $250,000 if you file jointly. It's not available for fleet purchases, commercial vehicles or leasing.
◾ Inflation Reduction Act: To take advantage of the EV credit, you also must buy the car − assembled in North America − for your own use. Your income must to fall below $150,000 for an individual and $300,000 for those filing jointly.
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Chicago Tribune
an hour ago
- Chicago Tribune
US tariffs on European goods threaten to shake up the world's largest trade relationship
FRANKFURT, Germany — The European Union expects to find out on Monday whether President Donald Trump will impose punishing tariffs on America's largest trade partner in a move economists have warned would have repercussions for companies and consumers on both sides of the Atlantic. Trump imposed a 20% import tax on all EU-made products in early April as part of a set of tariffs targeting countries with which the United States has a trade imbalance. Hours after the nation-specific duties took effect, he put them on hold until July 9 at a standard rate of 10% to quiet financial markets and allow time for negotiations. Expressing displeasure the EU's stance in trade talks, however, Trump said he would increase the tariff rate for European exports to 50%, which could make everything — from French cheese and Italian leather goods to German electronics and Spanish pharmaceuticals — much more expensive in the U.S. The EU's executive commission, which handles trade issues for the bloc's 27-member nations, said its leaders hope to strike a deal with the Trump administration. Without one, the EU said it was prepared to retaliate with tariffs on hundreds of American products, ranging from beef and auto parts to beer and Boeing airplanes. U.S. Treasury Secretary Scott Bessent told CNN's 'State of the Union' program on Sunday that 'the EU was very slow in coming to the table' but that talks were now making 'very good progress.' Here are important things to know about trade between the United States and the European Union. The EU's executive commission describes the trade between the U.S. and the EU as 'the most important commercial relationship in the world.' The value of EU-U.S. trade in goods and services amounted to 1.7 trillion euros ($2 trillion) in 2024, or an average of 4.6 billion euros a day, according to EU statistics agency Eurostat. The biggest U.S. export to Europe is crude oil, followed by pharmaceuticals, aircraft, automobiles, and medical and diagnostic equipment. Europe's biggest exports to the U.S. are pharmaceuticals, cars, aircraft, chemicals, medical instruments, and wine and spirits. Trump has complained about the EU's 198 billion-euro trade surplus in goods, which shows Americans buy more stuff from European businesses than the other way around. However, American companies fill some of the gap by outselling the EU when it comes to services such as cloud computing, travel bookings, and legal and financial services. The U.S. services surplus took the nation's trade deficit with the EU down to 50 billion euros ($59 billion), which represents less than 3% of overall U.S.-EU trade. Before Trump returned to office, the U.S. and the EU maintained a generally cooperative trade relationship and low tariff levels on both sides. The U.S. rate averaged 1.47% for European goods, while the EU's averaged 1.35% for American products. But the White House has taken a much less friendly posture toward the longstanding U.S. ally since February. Along with the fluctuating tariff rate on European goods Trump has floated, the EU has been subject to his administration's 50% tariff on steel and aluminum and a 25% tax on imported automobiles and parts. Trump administration officials have raised a slew of issues they want to see addressed, including agricultural barriers such as EU health regulations that include bans on chlorine-washed chicken and hormone-treated beef. Trump has also criticized Europe's value-added taxes, which EU countries levy at the point of sale this year at rates of 17% to 27%. But many economists see VAT as trade-neutral since they apply to domestic goods and services as well as imported ones. Because national governments set the taxes through legislation, the EU has said they aren't on the table during trade negotiations. 'On the thorny issues of regulations, consumer standards and taxes, the EU and its member states cannot give much ground,' Holger Schmieding, chief economist at Germany's Berenberg bank, said. 'They cannot change the way they run the EU's vast internal market according to U.S. demands, which are often rooted in a faulty understanding of how the EU works.' Economists and companies say higher tariffs will mean higher prices for U.S. consumers on imported goods. Importers must decide how much of the extra tax costs to absorb through lower profits and how much to pass on to customers. Mercedes-Benz dealers in the U.S. have said they are holding the line on 2025 model year prices 'until further notice.' The German automaker has a partial tariff shield because it makes 35% of the Mercedes-Benz vehicles sold in the U.S. in Tuscaloosa, Alabama, but the company said it expects prices to undergo 'significant increases' in coming years. Simon Hunt, CEO of Italian wine and spirits producer Campari Group, told investment analysts that prices could increase for some products or stay the same depending what rival companies do. If competitors raise prices, the company might decide to hold its prices on Skyy vodka or Aperol aperitif to gain market share, Hunt said. Trump has argued that making it more difficult for foreign companies to sell in the U.S. is a way to stimulate a revival of American manufacturing. Many companies have dismissed the idea or said it would take years to yield positive economic benefits. However, some corporations have proved willing to shift some production stateside. France-based luxury group LVMH, whose brands include Tiffany & Co., Luis Vuitton, Christian Dior and Moet & Chandon, could move some production to the United States, billionaire CEO Bernaud Arnault said at the company's annual meeting in April. Arnault, who attended Trump's inauguration, has urged Europe to reach a deal based on reciprocal concessions. 'If we end up with high tariffs, … we will be forced to increase our U.S.-based production to avoid tariffs,' Arnault said. 'And if Europe fails to negotiate intelligently, that will be the consequence for many companies. … It will be the fault of Brussels, if it comes to that.' Some forecasts indicate the U.S. economy would be more at risk if the negotiations fail. Without a deal, the EU would lose 0.3% of its gross domestic product and U.S. GDP would fall 0.7%, if Trump slaps imported goods from Europe with tariffs of 10% to 25%, according to a research review by Bruegel, a think tank in Brussels. Given the complexity of some of the issues, the two sides may arrive only at a framework deal before Wednesday's deadline. That would likely leave a 10% base tariff, as well as the auto, steel and aluminum tariffs in place until details of a formal trade agreement are ironed out. The most likely outcome of the trade talks is that 'the U.S. will agree to deals in which it takes back its worst threats of 'retaliatory' tariffs well beyond 10%,' Schmieding said. 'However, the road to get there could be rocky.' The U.S. offering exemptions for some goods might smooth the path to a deal. The EU could offer to ease some regulations that the White House views as trade barriers. 'While Trump might be able to sell such an outcome as a 'win' for him, the ultimate victims of his protectionism would, of course, be mostly the U.S. consumers,' Schmieding said.
Chicago Tribune
an hour ago
- Chicago Tribune
Elon Musk forms new political party after split with Trump over president's signature tax cuts law
BRIDGEWATER, N.J. — Elon Musk said he's carrying out his threat to form a new political party after his fissure with President Donald Trump, announcing the America Party in response to the president's sweeping tax cuts law. Musk, once an ever-present ally to Trump as he headed up the slashing agency known as the Department of Government Efficiency, broke with the Republican president over his signature legislation, which was signed into law Friday. As the bill made its way through Congress, Musk threatened to form the 'America Party' if 'this insane spending bill passes.' 'When it comes to bankrupting our country with waste & graft, we live in a one-party system, not a democracy,' Musk said Saturday on X, the social media company he owns. 'Today, the America Party is formed to give you back your freedom.' The formation of new political parties is not uncommon, but they typically struggle to pull any significant support away from the Republican and Democratic parties. But Musk, the world's richest man who spent at least $250 million supporting Trump in the 2024 election, could impact the 2026 elections determining control of Congress if he is willing to spend significant amounts of money. His reignited feud with the president could also be costly for Musk, whose businesses rely on billions of dollars in government contracts and publicly traded company Tesla has taken a hit in the market. It wasn't clear whether Musk had taken steps to formally create the new political party. Spokespeople for Musk and his political action committee, America PAC, didn't immediately comment Sunday. As of Sunday morning, there were multiple political parties listed in the Federal Election Commission database that had been formed in the the hours since Musk's Saturday X post with versions of 'America Party' of 'DOGE' or 'X' in the name, or Musk listed among people affiliated with the entity. But none appeared to be authentic, listing contacts for the organization as email addresses such as 'wentsnowboarding@ or untraceable Protonmail addresses. Musk on Sunday spent the morning on X taking feedback from users about the party and indicated he'd use the party to get involved in the 2026 midterm elections. Last month, he threatened to try to oust every member of Congress that voted for Trump's bill. Musk had called the tax breaks and spending cuts package a 'disgusting abomination,' warning it would increase the federal deficit, among other critiques. 'The Republican Party has a clean sweep of the executive, legislative and judicial branches and STILL had the nerve to massively increase the size of government, expanding the national debt by a record FIVE TRILLION DOLLARS,' Musk said Sunday on X. His critiques of the bill and move to form a political party mark a reversal from May, when his time in the White House was winding down and the head of rocket company SpaceX and electric vehicle maker Tesla said he would spend 'a lot less' on politics in the future. Treasury Secretary Scott Bessent, who clashed with Musk while he ran DOGE, said on CNN's 'State of the Union' on Sunday that DOGE's 'principles' were popular but 'if you look at the polling, Elon was not.' 'I imagine that those board of directors did not like this announcement yesterday and will be encouraging him to focus on his business activities, not his political activities,' he said.
The Hill
an hour ago
- The Hill
For the sake of his party and country, Schumer should step aside
Halfway through 2025, Senate Minority Leader Chuck Schumer (D-N.Y.) is the embodiment of the kind of leader that his party's base clearly does not want. A new Reuters-Ipsos poll found that 62 percent of self-identified Democrats agreed that 'the leadership of the Democratic Party should be replaced with new people.' And key findings from that survey indicate that Schumer is the party's most out-of-step leader. The poll showed that a large majority of Democrats want elected officials to reduce 'corporate influence,' while a whopping 86 percent 'said changing the federal tax code so wealthy Americans and large corporations pay more in taxes should be a priority.' But Schumer's record is the epitome of corporate influence. For decades, he has given priority to protecting the financial interests of the wealthy and of large corporations. Schumer vowed not to step aside after he infuriated the vast bulk of congressional Democrats with his vote for President Trump's spending bill in March. That vote also incensed grassroots Democrats across the country, to the point that he felt compelled to abruptly call off an imminent, long-planned publicity tour for his new book that month. In effect, Schumer has become persona non grata among his party's voters in many blue states. More than three months after his 'postponed' book tour, it has not been rescheduled — the Senate's top Democrat is evidently wary of photo ops of protests against him by Democrats around the country. He remains the top Democrat in the Senate at a time when he is deeply unpopular among voters eager for leadership to put up a fight against the Trump administration. If Senate Democrats are serious about reversing their party's tailspin and improving its public image, they should insist on ending Schumer's stint as minority leader. It is time for Democratic colleagues to put their foot down instead of deferring to New York's senior senator. Schumer's behavior stands in sharp contrast to the example set by Rep. Nancy Pelosi (D-Calif.). When Democrats lost control of the House in January 2023, causing Pelosi to lose the Speaker's gavel, she could have taken the post of minority leader but instead chose to step aside. But when Democrats lost control of the Senate in early January of this year, dislodging Schumer as majority leader, he chose to become minority leader. Now, by clinging to that post, Schumer is damaging the party's ability to rebound from its setbacks last fall and its current abysmal approval ratings. Schumer's unwelcome nickname — 'the senator from Wall Street' — is longstanding and well-earned. He reached new heights as corporate America's champion on Capitol Hill during the 2008 financial crisis, when he 'became one of the first officials to promote a Wall Street bailout,' as reported by The New York Times. Schumer was playing 'an unrivaled role in Washington as beneficiary, advocate and overseer of an industry that is his hometown's most important business.' By fall 2009, more than 15 percent of the year's contributions from Wall Street to all senators had gone to Schumer himself. Schumer has since remained closely aligned with the very corporate interests that most Democratic voters don't want party leaders to serve. Meanwhile, sectors such as banking, real estate, finance and the tobacco industry have sent floods of appreciative donations into Schumer's campaign coffers. At the end of 2024, Schumer's campaign committee reported a six-year donor haul of nearly $43 million. More than one-quarter of that total came just from securities and investment companies, real estate interests, law firms and lawyers. While those patrons and other major backers are presumably happy with Schumer's capacity to sway legislation, many of his own constituents want him out of Senate leadership. A Marist poll in April found that 53 percent of New Yorkers think he should relinquish his minority leader position. Here is how the grassroots pro-Democratic group Pass the Torch described him earlier this year: 'Chuck Schumer is unwilling and unable to meet the moment. His sole job is to fight MAGA's fascist takeover of our democracy — instead, he's directly enabling it. Americans desperately need a real opposition party to stand up to Trump.' Schumer is the most powerful symbol of how the current Democratic Party has lost touch with its base of voters who will be crucial for making gains in the midterm election next year and recapturing the White House in 2028. Continuing to enshrine him as the biggest spokesperson for Senate Democrats is a way of telling voters that catering to the personal ambition of a timeworn politician is a higher priority than being responsive to the party's constituents. Every two years, we hear how the results of federal elections will hinge on turnout. Yet the fact that Schumer remains entrenched as the top Democrat in the Senate indicates that the party is willing to depress its voter turnout rather than shake up its power structure in Congress. As long as the likes of Schumer are running the Democratic show on Capitol Hill, the party of Trump has little to worry about. Norman Solomon is cofounder of RootsAction and executive director of the Institute for Public Accuracy. His book 'War Made Invisible: How America Hides the Human Toll of Its Military Machine' was published in 2023.
