DINING WITH ASIAN FOOD AND WINE

A TASTE OF ASIA, A WINE AND ASIAN FOOD PAIRING

Part 3 of 8 “TASTE OF ASIA” series

Ronald G. Jan, M. D.

Having just eaten a wonderful deep fried pork belly (from THAI) paired with a well-balanced  Cabernet Sauvignon [described on last month’s “Dining with Asian Food and Wine”], I was wondering, “What other Asian food can interact with a red wine?”  The next course was beef bulgogi from Blue House Korean BBQ—sweet and savory with the right amount of spice with a side dish (banchan) of kimchi.

02 01 Small Korean BBBQ

[Beef Bulgogi from Blue House Korean BBQ. Photo Courtesy of Ronald Jan, M.D.]

To this was served a Petit Verdot from Jeff Runquist Winery in Amador County. 

02 01 Small Runquist Petit

[Petit Verdot by Jeff Runquist Wines.Photo Courtesy of Ronald Jan, M.D. ]

Nicely balanced with aromas and flavors of dark fruit—blackberry, black cherry, and oak with enough tannin to balance the strong flavors of the beef bulgogi and at the same time not too harsh of tannins that the tannins were softened by the texture and fat of the beef. 

Noted restaurant food and wine critic, Mike Dunne, commented…

            With its richness and its spicy overtones, the beef bulgogi has a lot going on, calling for a wine of comparable heft and layering.  That would be the Jeff Runquist Wines San Joaquin County Petit Verdot.  Through its lavish berry fruit, thread of mocha, flanking smoke, backing tannins and ample oak, the Runquist Petit Verdot meets stride for stride the sweet and juicy abundance of the beef bulgogi.

Petit Verdot noted for its dark color and tannin has been a grape traditionally considered as a blending grape in Bordeaux, France.   But here in the hands of Jeff Runquist the Petit Verdot stands up for itself well with good fruit and balance with enough acid and a pleasant long finish. 

Red wines with Asian foods?---YES….considering flavors:  matching pronounced flavors of the foods with the flavors, and the structure of the wines.  Certainly, delicate flavors with delicate sauces in many Asian foods will balance well with many white wines such as Riesling, Gewurztraminer, or rose’s like rose’s from Tavel, France.  But, if your Asian dish has pronounced flavors with significant texture a red wine can make a wonderful match.

What a wonderful adventure—try something new!

About the author: Dr. Ronald G. Jan who specializes in Vascular Surgery is a Clinical Professor of Surgery at the University of California at Davis School of Medicine. He has been serving as the Director of Paul Hom’s Asian (Free) Clinic since 2005. As a hobby, he holds WSET level 3 certification in wines and has been writing and publishing wine commentaries attracting lots of readers.

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DINING WITH ASIAN FOOD AND WINE

Part 2 of 8 “TASTE OF ASIA” series

Ronald G. Jan, M.D.

At the TASTE OF ASIA on November 12, 2022, another dish presented was a whole Roast Pig from Vinh Phat Market.   A whole roast pig is part of many cultures from “Lichon” of the Philippines to “Pua’a Kalua” in Hawaii to “Lon Quay” in Vietnam.  When serving, the pig was cut into pieces and reassembled to look like a whole pig.

01 01 2023 Small Whole Roast Pig

[Whole roasted pig from Vinh Phat Market in Sacramento. Photo courtesy:

https://drive.google.com/file/d/1BOsosu_quDcT0OvVyfa9wGoFV5DqNTZ-/view?usp=sharing_eip_m&ts=637af17a]

With its crispy skin, savory fat and rich meat, the pieces of roast pig from Vinh Phat Market in Sacramento paired well with Lusso della Terra’s Barbera Pet-Nat (short for Petillant-Naturel) with acid which cut through the fat while bringing freshness with red berry flavors added to the pieces of roast pig.

01 01 2023 Small Lusso Della Terra

[Lusso Della Terra’s Barbera Petillant (aka “Pet-Nat”).Photo Courtesy of Ronald Jan, M.D.]

 

Again, here is famed food and wine writer, Mike Dunne’s comments…

Roast pig with hoisin sauce: The Lusso Della Terra Winery & Vineyard Pet Nat Barbera is a rare but fitting wine to start a celebratory dinner. For one, it is a sparkling wine, though its effervescence is gentler than commonly found in wines with bubbles. Aside from its leisurely effervescence, the wine’s deep cranberry color, pronounced berry aroma, fruity delivery and substantial structure make it an amiable companion for the richness and meatiness of roast pig. As to its name, “Pet Nat” is wine-geek shorthand for “petillant naturel,” which translates as “naturally bubbling.” Unlike Champagne and California sparkling wines generally, pet-nat bubblies do not undergo a secondary fermentation with added sugar and yeast. Rather, pet-nat wines are regular wines that are bottled before their fermentation is finished, which explains both their softer froth and their closure - a metal crown rather than cork. Lusso Della Terra is a relatively new player at Fiddletown in Amador County, where the black Italian grape Barbera is rising in popularity, potential and esteem.

The Petillant Naturel Method is also called, “Ancestral Method” because it was the very first way sparkling wines were discovered (by accident) and later made by design.  The sparkling wine at that time (16th Century) was called, “Vin du Diable (Wine of the Devil)” because the bottles would explode under the pressure with glass being so thin.  Also, Pet-Nat wines can be quite inconsistent in quality.  Lusso della Terra’s Ed Chokarian has found a way to make his finished product consistently good with fruit and acidity, a hallmark of the Barbera grape.  And don’t worry—the glass bottles are thicker now and the sparkling only mildly effervescent. 

This Roast Pig with the sparkling Barbera started the evening’s dining event with brightness, freshness, and a very festive mood.  By the way, Chinese New Year is right around the corner on January 22, 2023.  Why not include Roast Pig and a Barbera Pet-Nat in your New Year Eve’s dinner celebrating the Year of the Rabbit ?  Let’s party!

BON APPETITE!!!

About the author: Dr. Ronald G. Jan who specializes in Vascular Surgery is a Clinical Professor of Surgery at the University of California at Davis School of Medicine. He has been serving as the Director of Paul Hom’s Asian (Free) Clinic since 2005. As a hobby, he holds WSET level 3 certification in wines and has been writing and publishing wine commentaries attracting lots of readers.

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06 07 IRS News Release HeadLine image

【《We Chinese in AmericaMedia Editor Tang Zhao, December 31, 2022As an ongoing effort to enhance our valuable service to We Chinese in America website readers, We Chinese in America website posts English and Chinese versions of “IRS News Release” “IRS Fact Sheets” and “tax tips” directly received from IRS Media Relations Office in Washington, D.C.. We are pleased to take on this important role partnering with IRS to better inform the public.

IRS issues standard mileage rates for 2023; business use increases 3 cents per mile

 

WASHINGTON — The Internal Revenue Service today issued the 2023 optional standard mileage rates used to calculate the deductible costs of operating an automobile for business, charitable, medical or moving purposes.

                               

Beginning on Jan. 1, 2023, the standard mileage rates for the use of a car (also vans, pickups or panel trucks) will be:

  • 65.5 cents per mile driven for business use, up 3 cents from the midyear increase setting the rate for the second half of 2022.
  • 22 cents per mile driven for medical or moving purposes for qualified active-duty members of the Armed Forces, consistent with the increased midyear rate set for the second half of 2022.
  • 14 cents per mile driven in service of charitable organizations; the rate is set by statute and remains unchanged from 2022.

These rates apply to electric and hybrid-electric automobiles, as well as gasoline and diesel-powered vehicles.

The standard mileage rate for business use is based on an annual study of the fixed and variable costs of operating an automobile. The rate for medical and moving purposes is based on the variable costs.

It is important to note that under the Tax Cuts and Jobs Act, taxpayers cannot claim a miscellaneous itemized deduction for unreimbursed employee travel expenses. Taxpayers also cannot claim a deduction for moving expenses, unless they are members of the Armed Forces on active duty moving under orders to a permanent change of station. For more details see Moving Expenses for Members of the Armed Forces.

Taxpayers always have the option of calculating the actual costs of using their vehicle rather than using the standard mileage rates.

Taxpayers can use the standard mileage rate but generally must opt to use it in the first year the car is available for business use. Then, in later years, they can choose either the standard mileage rate or actual expenses. Leased vehicles must use the standard mileage rate method for the entire lease period (including renewals) if the standard mileage rate is chosen.

Notice 2023-03 contains the optional 2023 standard mileage rates, as well as the maximum automobile cost used to calculate the allowance under a fixed and variable rate (FAVR) plan. In addition, the notice provides the maximum fair market value of employer-provided automobiles first made available to employees for personal use in calendar year 2023 for which employers may use the fleet-average valuation rule in or the vehicle cents-per-mile valuation rule.

Source: IRS News Release

Internal Resource Service

Media Relation Office

Washington, D. C

Media Contact: 202 317 4000

Public Contact: 800 829 1040

www.IRS.GOV/NewsRoom

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【《We Chinese in AmericaMedia Editor Hugh Wang, January 6, 2023】 Following article from San Diego Union Tribune, January 4, 2023.

Judith and Howard Rubenstein’s travels in China in 1984 had a big impact on them.

The trip inspired Howard Rubenstein to create “Romance of the Western Chamber - the Musical.” The family friendly show can be seen at 7 p.m. Jan. 7 and 2 p.m. Jan. 8 in the Poway Center for the Performing Arts.

“We had a wonderful time, were impressed by the beauty and culture of China and the warmth of its people,” Judith Rubenstein recalled about the trip.

It also made her late husband realize that while the La Jolla couple knew plays written in French, Italian, Spanish, German, ancient Greek and Russian, they were not familiar with any Chinese plays, she said.

“He asked, ‘How come we do not know Chinese plays? It is a great culture,’” she recalled.

2023 01 06 RWB 1

After 40 years as a physician, in his retirement Howard became a self-taught playwright. He wrote 10 plays, with several presented on local stages, and many books. After their trip to China he decided to find a Chinese play, write an adaptation for the Western stage and turn it into a musical even though he did not speak Chinese or know how to compose music, his widow said.

The result: “Romance of the Western Chamber - a Musical,” based on “Xi Xiang Ji,” a 13th century Chinese romantic comedy that is very well known in China, Rubenstein said. The original play was inspired by a ninth century Chinese poem.

Rubenstein said her husband of 52 years — who died of cancer at age 89 in September 2020 — did extensive research into Chinese plays. He found many with English translations, but they were long and scholarly, making them not suitable for the stage.

However “Xi Xiang Ji” was different. She called it “the equivalent to our Cinderella. ... It is a very old play but in a very modern context ... and it’s charming.”

Chang (played by Jordan Fan) is a poor scholar who falls in love with Ying-ying (Lia Zheng), daughter of the late prime minister. Her attendant, Hong-niang (Evelyn Olson), takes on the role of their matchmaker. However, Ying-ying’s mother, Lady Tsui (Becca Tang), wants her daughter to marry a nobleman due to a promise made by her late husband.

According to Rubenstein, the story is so well known in China that the name Hong-niang has become synonymous with matchmaker.

To write the songs her husband listened to a lot of Chinese music, found segments of folk songs he liked, then worked via email with a composer and arranger to create music that would work with his lyrics. Max Lee, a pseudonym, has composed nearly 100 concert works. This is his first full-length musical theater work.

According to Rubenstein, her husband said the music had to be Chinese, but “sound good to the Western ear” because some here do not appreciate the tonal scale in Chinese music.

“He identified phrases that sounded very pretty and that Westerners would like, then used those phrases to build a song around it,” she explained.

The musical has only been presented twice. The first time was in 2011 in China, presented in English with Mandarin supertitles. The second was in 2017 in New York City.

Tickets to the Poway shows are $20-$40 for standard seats; $10-$30 for seniors, military and students; and $10-$20 for children. Purchase powaycenter.com or at the PCPA box office from 1 to 6 p.m. Friday and Saturday. The PCPA is at 15498 Espola Road. For questions, call 858-748-0505.

 

(From San Diego Union Tribune,   by Elizabeth Marie Himchak  )

03 17 IRS Fact Sheets Image

【《We Chinese in AmericaMedia Editor Tang Zhao, December 30, 2022As an ongoing effort to enhance our valuable service to We Chinese in America website readers, We Chinese in America website posts English and Chinese versions of “IRS News Release” “IRS Fact Sheets” and “tax tips” directly received from IRS Media Relations Office in Washington, D.C.. We are pleased to take on this important role partnering with IRS to better inform the public.

 

Frequently asked questions related to new, previously-owned and qualified commercial clean vehicle credits

FS-2022-42, December 2022

This Fact Sheet issues frequently asked questions related to new, previously-owned and qualified commercial clean vehicle.

New clean vehicle credit, previously-owned vehicle credit and qualified commercial clean vehicles credit frequently asked questions

Background

The Inflation Reduction Act of 2022 (IRA) makes several changes to the tax credit provided in § 30D of the Internal Revenue Code (Code) for qualified plug-in electric drive motor vehicles, including adding fuel cell vehicles to the § 30D tax credit. The IRA also added a new credit for previously-owned clean vehicles under § 25E of the Code.

These FAQs provide detail on how the IRA revises the credit available under § 30D (new clean vehicle credit) for individuals and businesses, and information on the credit available under § 25E (previously-owned clean vehicle credit) for individuals, and the new credit for qualified commercial clean vehicles under § 45W of the Code.

Topic A: Eligibility Rules for the New Clean Vehicle Credit under § 30D effective 1/1/2023

Q1. What is a new clean vehicle for purposes of the new clean vehicle credit? (added December 29, 2022)

A1. For purposes of the new clean vehicle credit, a new clean vehicle is a clean vehicle placed in service on or after January 1, 2023, that is acquired by a taxpayer for original use. In addition, to qualify for the credit, the vehicle:

  • Cannot be acquired for resale purposes;
  • Must be manufactured by a qualified manufacturer;
  • Must meet the definition of a motor vehicle under Title II of the Clean Air Act (that is, any vehicle manufactured primarily for use on public streets, roads, and highways. It must also have at least four wheels);
  • Must have a gross vehicle weight rating of less than 14,000 pounds;
  • Must be powered to a significant extent by an electric motor with a battery capacity of 7 kilowatt hours or more and must be capable of being recharged from an external source of electricity; and
  • Must have final assembly in North America.

Moreover, for a taxpayer to claim the credit, the seller of a new clean vehicle must provide a report containing taxpayer and vehicle information to the taxpayer and to the IRS. See Topic B FAQs 7-9 for additional detail.

Fuel cell vehicles are also new clean vehicles if (1) the original use begins with the taxpayer, (2) the final assembly is in North America, and (3) the seller of the vehicle provides a report to the taxpayer and the IRS.

Q2. Is there a list of vehicles that qualify for the new clean vehicle credit? (added December 29, 2022)

A2. Yes. The following link contains a list of eligible clean vehicles, including fuel cell vehicles, qualified manufacturers have indicated to the IRS meet the requirements to claim the new clean vehicle credit beginning January 1, 2023:  Clean Vehicle Qualified Manufacturer Requirements. This list will be updated to reflect changes in vehicle eligibility. Verification of the manufacturer's suggested retail price and final assembly is required, see Topic B FAQs 2 and 3.

Q3. How will I know if the final assembly of a new clean vehicle is in North America? (added December 29, 2022)

A3. The final assembly point will be listed on the vehicle information label attached to each vehicle on a dealer's premises. In addition, you can search the vehicle identification number (VIN) of the vehicle on the Department of Energy's Alternative Fuels Data Center website.

In general, North America includes the United States (defined, for this purpose to mean the 50 states, the District of Columbia, and Puerto Rico), Canada, and Mexico for purposes of determining the location of final assembly.

The VIN Decoder website for the National Highway Traffic Safety Administration (NHTSA) also provides final assembly location information. The website, including instructions, can be found at VIN Decoder.

Q4. How will I know what the vehicle identification number (VIN) is for a new clean vehicle? (added December 29, 2022)

A4. The vehicle identification number is a 17-character number that uniquely identifies a vehicle. It is permanently attached to a vehicle in several locations, appearing on the dashboard for most passenger vehicles and on the label located on the driver’s door frame. The VIN is also located on the window sticker of new vehicles and often appears on the vehicle listing on dealers’ websites.

Q5. If I order a new clean vehicle in one year and don’t receive it until a subsequent year, when do I claim the credit? (added December 29, 2022)

A5. The new clean vehicle credit is claimed in the tax year that the vehicle is placed in service, meaning the tax year that includes the date the taxpayer takes delivery of the vehicle.

Q6. What is the amount of the new clean vehicle credit? (added December 29, 2022)

A6. Beginning January 1, 2023, eligible vehicles may qualify for a tax credit of up to $7,500.

Until the day after the Treasury Department and the IRS issue proposed guidance on the critical mineral and battery component requirements of the new clean vehicle credit under § 30D, the credit is calculated as a $2,500 base amount plus, for a vehicle which draws propulsion energy from a battery with at least 5 kilowatt hours of capacity, $417, plus an additional $417 for each kilowatt hour of battery capacity in excess of 5 kilowatt hours, up to an additional $5,000 beyond the base amount. In general, the minimum credit amount will be $3,751 ($2,500 + 3 * $417), representing the credit amount for a vehicle with the minimum of 7 kilowatt hours of battery capacity.

Once the Treasury Department and the IRS issue the proposed critical mineral and battery component guidance later in 2023, additional requirements will change the amount of the credit (that is, an eligible vehicle may qualify for more or less credit than before).  The credit amount will depend on the vehicle meeting the critical minerals requirement ($3,750) and/or the battery components requirement ($3,750).  A vehicle meeting neither requirement will not receive a credit, a vehicle meeting only one requirement may be eligible for a $3,750 credit, and a vehicle meeting both requirements may be eligible for the full $7,500 credit.  The Treasury Department and the IRS anticipate issuing the proposed guidance in March.

Q7. Is the new clean vehicle credit refundable or able to be carried forward?  (added December 29, 2022)

A7. No. The new clean vehicle credit may only be claimed to the extent of reported tax due of the taxpayer and cannot be refunded or carried forward. 

Q8. What does “original use” mean?  (added December 29, 2022)

A8. For purposes of the new clean vehicle credit, “original use” means that the vehicle has never been used by any taxpayer for any purpose.  A vehicle is not a new clean vehicle if another person has ever purchased or leased the clean vehicle and placed it in service for any purpose.   Where a vehicle is acquired for lease to another person, the lessor is the original user.

Q9. What is a qualified manufacturer?  (added December 29, 2022)

A9. A qualified manufacturer is a manufacturer that enters into a written agreement with the IRS to file periodic reports with vehicle identification numbers (VINs) and other information for each vehicle they manufacture. The IRS maintains a list of qualified manufacturers that can be found at Clean Vehicle Qualified Manufacturer Requirements.

Q10. Do I have to report the vehicle identification number on my return to claim the new clean vehicles credit?  (added December 29, 2022)

A 10. Yes. The vehicle identification number of the new clean vehicle is required to be included on Form 8936, Qualified Plug-in Electric Drive Motor Vehicle Credit, when you file your income tax return.

Topic B: Income and Price Limitations for the New Clean Vehicle Credit

Q1. Could my income level prevent me from taking the new clean vehicle credit?  (added December 29, 2022)

A1. Yes. You may not claim the credit if your modified adjusted gross income (AGI) exceeds certain thresholds. This limitation is based on the lesser of your modified AGI for the year that the new clean vehicle was placed in service or for the preceding year.  The relevant modified AGI thresholds are as follows:

  • Married filing jointly or filing as a qualifying surviving spouse or a qualifying widow(er) - $300,000
  • Head of household - $225,000
  • All other taxpayers - $150,000

Your modified AGI is the amount from line 11 of your Form 1040 plus:

  • Any amount on line 45 or line 50 of Form 2555, Foreign Earned Income.
  • Any amount excluded from gross income because it was received from sources in Puerto Rico or American Samoa.

Q2. Are there any price limitations on new clean vehicles eligible for the credit?  (added December 29, 2022)

A2. Yes. The manufacturer’s suggested retail price (MSRP) for the new clean vehicle may not exceed the following amounts for the following vehicle types:

  • Vans - $80,000
  • Sport Utility Vehicles - $80,000
  • Pickup Trucks - $80,000
  • Other - $55,000

If the MSRP exceeds the limitation for that specific vehicle type, that vehicle is not eligible for the new clean vehicle credit. 

The MSRP for this purpose is the base retail price suggested by the manufacturer, plus the retail price suggested by the manufacturer for each accessory or item of optional equipment physically attached to the vehicle at the time of delivery to the dealer.  It does not include destination charges or optional items added by the dealer, or taxes and fees.

The Clean Vehicle Qualified Manufacturer Requirements contains a list of eligible clean vehicles, including fuel cell vehicles, that qualified manufacturers have indicated to the IRS meet the requirements to claim the new clean vehicle credit beginning January 1, 2023. 

Q3. How will I know what the manufacturer’s suggested retail price (MSRP) is for a vehicle?  (added December 29, 2022)

A3. The MSRP will be on the vehicle information label attached to each vehicle on a dealer’s premises.  The MSRP for this purpose is the base retail price suggested by the manufacturer, plus the retail price suggested by the manufacturer for each accessory or item of optional equipment physically attached to the vehicle at the time of delivery to the dealer.  It does not include destination charges or optional items added by the dealer, or taxes and fees.

Q4. Would I still qualify for the new clean vehicle credit if the purchase price, including sales tax, fees, negative equity on a trade, etc., exceeds the manufacturer’s suggested retail price threshold?  (added December 29, 2022)

A4. The credit limitations on the price of the vehicle are based on manufacturer's suggested retail price, not the actual price you paid for the vehicle. See FAQ 2 for how to determine the manufacturer's suggested retail price.

Q5. If the manufacturer/dealer offers incentives on the purchase, and the total purchase price drops below the manufacturer’s suggested retail price limitation, will the vehicle be eligible for the new clean vehicles credit?  (added December 29, 2022)

A5. The credit limitations on the price of the vehicle are based on manufacturer's suggested retail price (MSRP), not the actual price you paid for the vehicle. See FAQ 2 for how to determine MSRP.

Q6. How do I know if my vehicle is a truck, van, SUV, or other type of vehicle for purposes of determining the applicable manufacturer’s suggested retail price for a vehicle?  (added December 29, 2022)

A6. The vehicle classifications of vehicles are described in IRS Notice 2023-9. The vehicle classification for this purpose may not match the classification on the fuel economy label or marketing materials describing the vehicle.

Vehicle classification information can be found at the Clean Vehicle Qualified Manufacturer Requirements page containing a listing of eligible clean vehicles, including fuel cell vehicles, that qualified manufacturers have indicated to the IRS meet the requirements to claim the new clean vehicle credit beginning January 1, 2023

Q7. What information does a seller have to provide to a taxpayer purchasing a new clean vehicle to allow the taxpayer to claim the new clean vehicle credit?  (added December 29, 2022)

A7. A seller must provide the following information on a report to the taxpayer and to the IRS:

  • Name and taxpayer identification number of the seller
  • Name and taxpayer identification number of the taxpayer
  • Vehicle identification number of the new clean vehicle
  • Battery capacity of the new clean vehicle
  • Verification that the taxpayer is the original user of the new clean vehicle
  • The date of the sale and the sales price of the vehicle
  • Maximum credit allowable for the new clean vehicle being sold
  • For sales after December 31, 2023, the amount of any transfer credit applied to purchase
  • A declaration under penalties of perjury from the seller

For further details see Revenue Procedure 2022-42.

Q8. When must the seller provide the report to the taxpayer?  (added December 29, 2022)

A8. The seller must provide the report to the taxpayer not later than the date the vehicle is purchased.  For further details see Revenue Procedure 2022-42.

Q9. How will a seller provide these reports to the IRS?  (added December 29, 2022)

A9. For vehicle sales occurring in calendar year 2023 and later, sellers must file reports within 15 days after the end of the calendar year, in a format and method that the IRS provides.  For further details see Revenue Procedure 2022-42.

Topic C: When the New Requirements Apply to the New Clean Vehicle Credit

Q1. On the day after the Inflation Reduction Act of 2022 became law (August 16, 2022), did any requirements for taxpayers or vehicles to qualify for the credit for new clean vehicles change? (added December 29, 2022)

A1. Yes, after August 16, 2022, a new clean vehicle must have had its final assembly in North America to be eligible for the credit. There is a transition rule for vehicles purchased before August 16, 2022. Additional changes begin January 1, 2023.

Q2. What additional changes to the credit apply for vehicles placed in service on or after January 1, 2023? (added December 29, 2022)

A2. The most significant changes to the credit for vehicles delivered on or after January 1, 2023, include:

  • The minimum battery capacity is increased to 7 kilowatt hours
  • Vehicles must be made by a qualified manufacturer (see Topic A, FAQ 9 for more detail)
  • MSRP limitations apply, based on the type of vehicle (see Topic B, FAQs 2 and 5 for more detail)
  • Income limits apply to taxpayers (see Topic B, FAQ 1 for more detail)
  • The taxpayer must report the vehicle identification number (VIN) of the vehicle on the taxpayer's income tax return
  • Sellers must provide reports to the taxpayer and the IRS regarding the sale of the vehicle

Q3. Does the "phase-out period" that limited or eliminated the credit for vehicles sold by certain manufacturers that had sold more than 200,000 vehicles still apply for vehicles sold after January 1, 2023? (added December 29, 2022)

A3. No, for vehicles sold on or after January 1, 2023, the prior sales volume limitations no longer apply. The prior sales volume limitations apply to vehicles sold before January 1, 2023.

Q4. Do the new critical mineral and battery components requirements apply? (added December 29, 2022)

A4. Not yet. The critical mineral and battery component requirements under § 30D(e) will apply for vehicles placed in service after proposed guidance on these requirements is issued. The publication of these FAQs is not the issuance of proposed guidance with respect to the critical mineral and battery component requirements under § 30D(e) and does not trigger the applicability of those requirements. The Treasury Department and the IRS will explicitly identify when they have issued proposed guidance with respect to the critical mineral and battery component requirements under § 30D(e). However, vehicles ordered or purchased prior to but placed in service after Treasury and the IRS issue this proposed guidance will be subject to the critical mineral and battery component requirements. This proposed guidance is expected to be issued in March 2023.

Q5. If I order a new clean vehicle in one year and don't receive it until a subsequent year, when do I claim the credit? (added December 29, 2022)

A5. The new clean vehicle credit is claimed in the tax year that the vehicle is placed in service, meaning the date the taxpayer takes delivery of the vehicle. For vehicles that are placed in service after they are ordered, a vehicle's eligibility for the new clean vehicle credit may change as certain eligibility criteria vary based on when the taxpayer takes delivery of the vehicle. For more information, see FAQ 7.

Q6: If I order (or purchase) an eligible new clean vehicle on or after August 16, 2022, but don't take delivery until after Treasury issues proposed guidance on the critical mineral and battery component requirements, will my vehicle still be eligible? (added December 29, 2022)

A6: The vehicle may or may not be eligible depending on whether it meets the critical mineral and battery component requirements. New clean vehicles placed in service after Treasury issues proposed guidance on critical mineral and battery component requirements are subject to those requirements even if the vehicle was ordered or purchased before the proposed guidance was issued. A vehicle's eligibility for the new clean vehicle credit is generally based on the criteria that apply as of the date a vehicle is placed in service, meaning the date the taxpayer takes delivery of the vehicle. For vehicles purchased prior to August 16, 2022, see Credits for New Electric Vehicles Purchased in 2022 or Before.

Q7: If I purchase a new clean vehicle in 2022 on or after August 16, 2022, but take delivery of the vehicle in 2023, do the income and MSRP limitations apply? (added December 29, 2022)

A7: Yes, the income and MSRP limits apply to any vehicle that is placed in service (delivered to the taxpayer) in 2023.

Q8: If I purchase a new clean vehicle in 2022 that was made by a manufacturer that had already reached the manufacturer sales cap but it is not delivered until 2023, does the manufacturer sales cap still apply? (added December 29, 2022)

A8: Yes, the sales cap of 200,000 vehicles applies to vehicles sold before January 1, 2023. If you purchased a vehicle that is subject to the sales cap, it is not eligible for the credit regardless of when you place it in service.

Topic D: Eligibility Rules for the Previously-Owned Clean Vehicles Credit

Q1. What is the previously-owned clean vehicles credit under § 25E? (added December 29, 2022)

A1. The previously-owned clean vehicles credit is a credit of up to $4,000 for the purchase of an eligible previously-owned clean vehicle with a sale price of $25,000 or less that is placed in service during a tax year by a qualified buyer. To claim the credit, a qualified buyer must meet certain income requirements (see FAQ 5) and it must be the vehicle's first qualified sale to a qualified buyer since August 16, 2022, other than to the original owner.

Q2. What is a previously-owned clean vehicle for the purpose of the previously-owned clean vehicles credit? (added December 29, 2022)

A2. A previously-owned clean vehicle is a motor vehicle that meets the following requirements:

  • The model year of the vehicle is at least two years earlier than the calendar year in which a taxpayer acquires the vehicle
  • The purchasing taxpayer is not the original user of the vehicle
  • The vehicle was acquired for a sales price of $25,000 or less from a dealer and the purchasing taxpayer is the first qualified buyer (see FAQ 4) to claim the credit since August 16, 2022, other than its original user
  • And such motor vehicle is a:
    • Qualified fuel cell motor vehicle with a gross vehicle weight rating of less than 14,000 pounds, or
    • A vehicle made by a qualified manufacturer (see Topic A FAQ 9) that meets the definition of a motor vehicle under Title II of the Clean Air Act, has a gross vehicle weight rating of less than 14,000 pounds, is powered to a significant extent by an electric motor with a battery capacity of seven kilowatt hours or more, and is capable of being recharged from an external source of electricity.

The dealer selling the previously-owned clean vehicle must provide a report containing purchaser and vehicle information to the purchasing taxpayer and to the IRS.

Q3. How will I know if a previously-owned clean vehicle may be eligible for a credit? (added December 29, 2022)

A3. Please see the following list Used Electric Vehicle Credit list about vehicle eligibility. In addition, qualified buyers will want to ensure their income does not exceed certain thresholds (see Topic E FAQ 1) and check the sales history of the vehicle to ensure that their purchase will qualify as the first transfer of the previously-owned vehicle to a qualified buyer (see FAQ 47) other than the person who was the original user of the vehicle.

Q4. Who is eligible to claim the previously-owned clean vehicle credit? (added December 29, 2022)

A4. Only individuals who meet the following requirements to be a "qualified buyer" can claim the previously-owned clean vehicle credit:

  • The taxpayer purchases the vehicle for use and not for resale.
  • The taxpayer cannot be claimed as a dependent on another taxpayer's tax return.
  • The taxpayer has not been allowed another previously-owned clean vehicle credit in the three-year period prior to the date the previously-owned clean vehicle is purchased.
  • The taxpayer's income level cannot exceed certain thresholds. (see Topic E FAQ 1)

Q5. What is the amount of the previously-owned clean vehicle credit? (added December 29, 2022)

A5. The previously-owned clean vehicle credit is the lesser of $4,000 or an amount equal to thirty (30) percent of the sales price of the vehicle purchased.

Q6. What is "original use" of a previously-owned clean vehicle? (added December 29, 2022)

A6. Original use occurs the first time an individual or business places a vehicle in service for personal or business purposes.

Q7. What is the first transfer since the date of enactment of a previously-owned clean vehicle? (added December 29, 2022)

A7. It is the first transfer of the vehicle after August 16, 2022, to a qualified buyer of the previously-owned clean vehicle credit other than the person who was the original user of the vehicle. See FAQ 4 information on individuals eligible to claim the previously-owned clean vehicle credit.

Q8. Can a business entity (e.g., a corporation or a partnership) purchase a previously-owned clean vehicle and claim the previously-owned clean vehicle credit? (added December 29, 2022)

A8. No. Only individuals are eligible for the previously-owned clean vehicle credit.

Q9. Can I buy a previously-owned clean vehicle from a person who isn't a dealer and still qualify for the previously-owned clean vehicle credit? (added December 29, 2022)

A9. No. To qualify for the credit, the previously-owned clean vehicle must be purchased from a dealer. A dealer is a person licensed to engage in the sale of motor vehicles in a State, the District of Columbia, the Commonwealth of Puerto Rico, any other territory or possession of the United States, an Indian tribal government, or any Alaska Native Corporation.

Q10: If I order or purchase a previously-owned clean vehicle in 2022 but take delivery of the vehicle in 2023, can the vehicle qualify for the previously-owed clean vehicle credit? (added December 29, 2022)

A10: Yes, if all other eligibility criteria are met.

Topic E: Income and Price Limitations Previously-Owned Clean Vehicles

Q1. Could my income level prevent me from taking the previously-owned clean vehicle credit? (added December 29, 2022)

A1. Yes. You may not claim the credit if your modified adjusted gross income (AGI) exceeds certain thresholds. This limitation is based on the lesser of your modified AGI for the year that the previously owned clean vehicle was placed in service or for the preceding year. The relevant modified AGI thresholds are as follows:

  • Married filing jointly or filing as a qualifying surviving spouse or a qualifying widow(er) - $150,000
  • Head of household - $112,500
  • All other filers - $75,000

Your modified AGI is the amount from line 11 of your Form 1040 plus:

  • Any amount on line 45 or line 50 of Form 2555, Foreign Earned Income.
  • Any amount excluded from gross income because it was received from sources in Puerto Rico or American Samoa.

Q2. Is there a price limitation on a previously-owned clean vehicles eligible for the credit? (added December 29, 2022)

A2. If the sales price exceeds the $25,000 limitation for previously-owned clean vehicle, the vehicle is not eligible for the previously-owned clean vehicle credit.

Topic F: Claiming the Previously-Owned Clean Vehicles Credit

Q1. What information does a dealer have to provide to a taxpayer purchasing a previously-owned clean vehicle to allow the taxpayer to claim the previously-owned clean vehicle credit? (added December 29, 2022)

A1. A dealer must provide the following information on a report to the taxpayer and to the IRS:

  • Name and taxpayer identification number of the dealer
  • Name and taxpayer identification number of the taxpayer
  • Vehicle identification number of the vehicle
  • Battery capacity of the vehicle
  • The date of the sale and the sales price of the vehicle
  • Maximum credit allowable for the vehicle being sold
  • For sales after December 31, 2023, the amount of any transfer credit applied to purchase
  • A declaration under penalties of perjury from the dealer

The dealer must provide the report to the taxpayer not later than the date the vehicle is purchased. For further details on dealer reporting see Topic B, FAQs 7- 9 and Revenue Procedure 2022-42.

Q2. Do I have to report the vehicle identification number on my return to claim the previously-owned clean vehicles credit? (added December 29, 2022)

A2. Yes. The vehicle identification number of the previously-owned clean vehicle is required to be included on Form 8936, Qualified Plug-in Electric Drive Motor Vehicle Credit (Including Qualified Two-Wheeled Plug-in Electric Vehicles and New Clean Vehicles), when you file your income tax return.

Q3. Is the previously-owned clean vehicle credit refundable or able to be carried forward? (added December 29, 2022)

A3. No. The previously-owned clean vehicle credit may only be used by a taxpayer to the extent the taxpayer has a reported tax due. The credit cannot be carried forward and the excess is not refundable.

Topic G: Qualified Commercial Clean Vehicles Credit

Q1. Who is eligible to claim a credit under § 45W of the Code for purchasing a qualified commercial clean vehicle (qualified commercial clean vehicles credit)? (added December 29, 2022)

A1. A taxpayer can claim a qualified commercial clean vehicles credit for purchasing and placing in service in the taxpayer's business a "qualified commercial clean vehicle" during the taxable year. The taxpayer must use the vehicle for a "business use." See FAQ 8.

Q2. What is a "qualified commercial clean vehicle"? (added December 29, 2022)

A2. A "qualified commercial clean vehicle" is defined as any vehicle of a character subject to the allowance for depreciation that:

  • Is made by a qualified manufacturer,
  • Is acquired for use or lease by the taxpayer and not for resale,
  • Is treated as a motor vehicle for purposes of title II of the Clean Air Act and is manufactured primarily for use on public streets, roads, and highways (not including a vehicle operated exclusively on a rail or rails), or is mobile machinery, as defined in § 4053(8) of the Code, and 
  • Is propelled to a significant extent by an electric motor which draws electricity from a battery that has a capacity of not less than 15 kilowatt hours (or, in the case of a vehicle that has a gross vehicle weight rating of less than 14,000 pounds, 7 kilowatt hours) and is capable of being recharged from an external source of electricity, or satisfies the requirements under § 30B(b)(3)(A) and (B) of the Code for being a new qualified fuel cell motor vehicle.

Q3. What is the amount of the qualified commercial clean vehicle credit a taxpayer can claim? (added December 29, 2022)

A3. The amount of the qualified commercial clean vehicle credit is the lesser of (1) 15 percent of the taxpayer's tax basis in the vehicle (30 percent in the case of a vehicle not powered by a gasoline or diesel internal combustion engine), or (2) the incremental cost of the vehicle.

The credit is limited to $7,500 in the case of a vehicle that has a gross vehicle weight rating of less than 14,000 pounds, and $40,000 for all other vehicles.

Q4. How is "incremental cost" determined? (added December 29, 2022)

A4. The incremental cost is the excess of the purchase price of a qualified commercial clean vehicle over the price of a comparable vehicle. A comparable vehicle is a vehicle powered solely by a gasoline or diesel internal combustion engine that is comparable in size and use to the qualified commercial clean vehicle. For a safe harbor to determine incremental cost for taxable year 2023, see Notice 2023-9.

Q5. Is a taxpayer that leases clean vehicles to customers as its business eligible to claim the qualified commercial clean vehicle credit? (added December 29, 2022)

A5. Whether a taxpayer can claim the qualified commercial clean vehicle credit in its business depends on who is the owner of the vehicle for federal income tax purposes. The owner of the vehicle is determined based on whether the lease is respected as a lease or recharacterized as a sale for federal income tax purposes.

Q6. What factors are used to determine if a transaction is a "lease" for tax purposes? (added December 29, 2022)

A6. Based on longstanding tax principles, the determination whether a transaction constitutes a sale or a lease of a vehicle for tax purposes is a question of fact. Features of a vehicle lease agreement that would make it more likely to be recharacterized as a sale of the vehicle for tax purposes include, but are not limited to:

  • A lease term that covers more than 80% to 90% of the economic useful life of the vehicle
  • A bargain purchase option at the end of the lease term (that is, the ability to purchase the vehicle at less than its fair market value at the end of the term) or other terms/provisions in the lease that economically compel the lessee to acquire the vehicle at the end of the lease term
  • Terms that result in the lessor transferring ownership risk to the lessee, for example, a terminal rental adjustment clause (TRAC) provision that requires the lessee to pay the difference between the actual and expected value of the vehicle at the end of the lease.

Q7. What happens if the clean vehicle lease agreement is recharacterized as a sale for tax purposes? (added December 29, 2022)

A7. In the event the clean vehicle lease is recharacterized as a sale, the lessee would need to determine if they are eligible to claim either a clean vehicle credit or a qualified commercial vehicle credit. The lessor would not be eligible to claim either credit because they would have engaged in a resale of the vehicle.

Q8. What does "of a character subject to the allowance for depreciation" mean for purposes of the qualified commercial clean vehicle credit? (added December 29, 2022)

A8. In general, property is subject to the allowance for depreciation if it is used in a trade or business of the taxpayer or for the production of income (business use).

Q9. How does a taxpayer determine if a vehicle is used in a "business use"? (added December 29, 2022)

A9. Generally, the term business use means any use in a trade or business of the taxpayer.

IRS-FAQ

Source: IRS Fact Sheets

Internal Resource Service

Media Relation Office

Washington, D. C

Media Contact: 202 317 4000

Public Contact: 800 829 1040

www.IRS.GOV/NewsRoom

 

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