Ford, GM Use Leasing 'Loophole' to Extend $7,500 EV Tax Credit

Ford Motor Company (NYSE:F) is one of the best stocks to buy under $20. On September 30, Ford and General Motors Company (NYSE:GM) initiated programs with their car dealers to effectively extend the benefit of the expiring $7,500 US federal tax credit on leases of EVs. This move comes just before the subsidy’s expiration date, which was set for September 30 by US President Donald Trump’s massive tax bill signed in July.

Industry experts had predicted that EV sales and leasing would significantly drop following the tax credit’s end, especially after a recent surge of purchases by buyers attempting to beat the deadline. The programs, which were recently rolled out to retailers, involve the automakers’ financing arms taking initial action to secure the credit. Specifically, the financing arms, such as Ford Credit and GM Financial, are making down payments on EVs currently in dealer inventory.

According to company documents and dealers, these down payments legally qualify the lending arms for the $7,500 federal tax credit on those specific vehicles. Dealers can then offer leases on these pre-qualified cars to retail customers for several more months, with the full $7,500 subsidy factored into the reduced lease rate. Ford stated it is working to provide competitive lease payments on retail leases through Ford Credit until December 31.

Ford Motor Company (NYSE:F) develops, delivers, and services Ford trucks, sport utility vehicles, commercial vans & cars, and Lincoln luxury vehicles worldwide. It operates through the Ford Blue, Ford Model e, Ford Pro, and Ford Credit segments.

General Motors Company (NYSE:GM) designs, builds, and sells trucks, crossovers, cars, and automobile parts worldwide. The company operates through GM North America, GM International, Cruise, and GM Financial segments.

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Disclosure: None. This article is originally published at Insider Monkey.