Score $7,500 Tax Credit on Tesla Model 3!

The facelifted Tesla Model 3 Long Range All-Wheel Drive could potentially qualify for a $7,500 federal tax credit when making a purchase. While the official Tesla website still lists the Model 3 Performance as the only version eligible for the tax incentive, several Reddit posts from reservation holders indicate otherwise. The federal tax credit can be applied to all versions of the Model 3 when leasing.


Thanks to the $7,500 federal tax credit, the longest-range Tesla Model 3 may soon cost just under $40,000, making it a more affordable option for buyers. This change has not yet been updated on Tesla’s official website, but reservation holders have shared that their vehicles are eligible for the tax credit upon purchase. Tesla released the updated Model 3 in Europe and China last year, followed by North American deliveries starting in January.

Why Does It Matter?

With the tax break applied at the point of sale, the price of the Model 3 Performance essentially matches the MSRP of the Long Range version, rendering the latter less appealing. Should Tesla manage to reclassify the Long Range Model 3’s battery under the updated Inflation Reduction Act regulations, the selling price of this mid-tier electric vehicle could drop to $39,990 for eligible buyers – just $1,000 more than the base-spec rear-wheel drive version, offering significant value for money.

How Is It Going to Shape the Future?

To qualify for the tax credit, the price of the Model 3 must not exceed $55,000, including certain specified optional equipment physically attached at the time of delivery. The Model 3 Long Range All-Wheel Drive boasts an impressive EPA range rating of 341 miles on a full charge, with a zero to 60 mph acceleration in 4.2 seconds and a top speed of 125 mph. In comparison, the Model 3 Performance features dual-motor all-wheel drive, delivering over 500 horsepower, a zero to 60 mph time of 2.9 seconds, and a top speed of 163 mph. The Performance version also includes premium features such as sport seats, adaptive suspension, 20-inch forged wheels, and the latest driving software with Track Mode V3.

In conclusion, the potential eligibility of the Tesla Model 3 Long Range All-Wheel Drive for the $7,500 federal tax credit offers buyers an attractive opportunity to own this high-performance electric vehicle at a more affordable price point, reshaping the landscape of electric car ownership and incentivizing more consumers to make the switch to sustainable transport options.