Tax Breaks May Allow $32,500 Savings On Tesla Model X

Buyers of the Tesla model S already have the luxury of receiving a $7,500 income tax credit, with other incentives varying state to state, however, the Tesla Model X could have a tax incentive worth another $25,000.

Early estimates for the price of the Tesla Model X are in the range of $75,000 to over $100,000. That price could be much easier for consumers to handle with over $30,000 in tax breaks. Numerous reports indicated that the Tesla Model X might qualify for a federal tax break of $25,000 due to its high weight. The gross weight of the Model X approaches 6,000 pounds, making it potentially acceptable under section 179 of the IRS code as a major tax write-off. The $25,000 tax incentive for the Model X would be in addition to the $7,500 tax credit and for California buyers, a $2,500 state rebate.

If the Model X is released costing $75,000, the right tax breaks could help a buyer trim the tax-adjusted price down in a state like California, to $40,000. The $25,000 tax break was a popular among Hummer H1 and H2 owners. The $25,000 tax break is only available to those buyers who own a business and are making the Model X their business vehicle. However, if the tax-adjusted price for the Model X really is $40,000, a few LLCs might start popping up in California.

For the time being, only six people, including Elon Musk even have a Model X. The price of the vehicle is not currently known, yet tens of thousands of consumers put a deposit on the vehicle without knowing the eventual cost. Model X vehicles are expected to trickle into the hands of consumers during the latter half of 2015 and into 2016.

What are your thoughts on the Model X tax break? Should a vehicle already subject to a $7,500 tax rebate and other discounts be permitted to have what amounts to a $25,000 price reduction? How would a $40,000 Tesla Model X impact retail automotive?