Volkswagen Confirms $7,500 Federal Tax Credit For ID.4 In 2024

Volkswagen announced that the all-electric ID.4 model in the U.S. will be eligible for the full $7,500 federal tax credit in 2024.

Let’s recall that the 2023 Volkswagen ID.4 qualified for the incentive in 2023 but disappeared from the list on January 1, 2024, as the requirements for local battery components became tougher.

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Volkswagen ID.4 Was Popular In 2023

The Volkswagen ID.4 was the fifth most popular all-electric model in the U.S. last year. In the not-too-distant future, it will be joined by the ID.7 and ID. Buzz models.

According to the German manufacturer, the existing 2023 Volkswagen ID.4 (with SK On battery components) that are placed in service in 2024 will be eligible for the full $7,500 Federal Tax Credit on a purchase by a qualifying purchaser.

At the same time, the upcoming 2024 Volkswagen ID.4—”when released with SK On components”—is also expected to be fully eligible for the incentive.

Volkswagen explains: “MY24 ID.4 qualification is based on current battery supply, but because vehicle qualification in 2024 is dependent on batteries not yet produced, qualification is subject to change. Volkswagen is optimistic that MY24 ID.4 vehicles will qualify during the entirety of 2024, and will provide updates when received.”

The recently updated fueleconomy.gov website, based on Internal Revenue Service info, confirms that with the ID.4 re-appearing on the list:

Of course, like in the case of any other EV model, the incentive might be available through leasing (because the requirements are different).

Volkswagen underlines that the Volkswagen ID.4 is an affordable all-electric model, with a starting price of $38,995 and partially thanks to the federal tax credit, also very popular (with almost 38,000 sales in 2023).

An interesting thing is that Volkswagen is the only foreign automaker that has a battery electric vehicle that is eligible for the full Federal Tax credit. The key is local production of the car, as well as its batteries (SK On).

Model Base Price Dest. Charge Tax Credit Effective Price
2023 Volkswagen ID.4 Standard 19-inch $38,995 +$1,295 $7,500 $32,790
2023 Volkswagen ID.4 S 20-inch $43,995 +$1,295 $7,500 $37,790
2023 Volkswagen ID.4 Pro 19-inch $43,995 +$1,295 $7,500 $37,790
2023 Volkswagen ID.4 Pro S 20-inch $48,995 +$1,295 $7,500 $42,790
2023 Volkswagen ID.4 AWD Pro 19-inch $47,795 +$1,295 $7,500 $41,590
2023 Volkswagen ID.4 AWD Pro S 20-inch $52,795 +$1,295 $7,500 $46,590

Pablo Di Si, President and CEO of Volkswagen Group of America said: “This is great news for consumers in the U.S. because it expands the choice of truly affordable EVs. The ID.4 is already one of the lowest-priced electric SUVs on the market, and the $7,500 Federal Tax Credit makes it even more attainable. This shows that we made the right decision to localize assembly of the ID.4 in Tennessee and invest even further in battery production, components and innovation. Every ID.4 sold supports thousands of American jobs and helps advance our goal of a carbon-neutral future.”

“Soon” the company will release the 2024 model year version. We already saw EPA-range and energy consumption data, indicating a noticeable improvement in range. Pricing and specs have not yet been announced.