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Colorado Tax Credit

Colorado Tax Credit

The Federal Tax Credit has been explained and explored in great depth, but not the $6000 Colorado Tax Credit. First the good news, the credit is based on vehicle MSRP and battery capacity, and phases out over time unrelated to the number of cars sold. The formula is a little convoluted, but what in the tax code isn't?

Here's the formula:
[MRSP - Credits or rebates (Federal, local, dealer, etc)] * [battery capacity in kWh / 100] * factor based on year

The year factors are 100% for 2013-2018, 75% for 2019, 50% for 2020 and 25% for 2021 after which the credits expire.

Calculating the credit for a base Model 3 with a price of $35,000 and assuming a 55 kWh battery and the full Federal credit Colorado residents should qualify for the full Colorado credit through 2020. To get the full Colorado credit in 2021 I assumed the Federal tax credit has expired (likely) a 55kWh battery and an MSRP of $43,636 or a 60kWh battery and an MSRP of $40,000. That means a reasonably well optioned Model 3 will qualify for the full Colorado tax credit through 2021.

For anyone living in Colorado, that's great news.

If anyone wants read the actual tax form it is located here.

Year 2013-18 2019 2020 2021 2021

MSRP 35000 35000 35000 43636 40000
Federal Credit 7500 7500 7500 0 0
Other credits 0 0 0 0 0
Line 2 + 3 7500 7500 7500 0 0
Line 1 - 4 27500 27500 27500 43636.36364 40000
Battery capacity kWh 55 55 55 55 60
Line 6 / 100 0.55 0.55 0.55 0.55 0.6
Line 5 * 7 15125 15125 15125 24000 24000
Date Factor 1 0.75 0.5 0.25 0.25
Line 8 * 9 15125 11344 7563 6000 6000
Maximum Credit 6000 6000 6000 6000 6000
Smaller of 10 and 11 6000 6000 6000 6000 6000
(sorry about the poor formatting, but proportional fonts aren't the best for tables and I have no idea how, or if it's even possible, to change it on this forum)