Tesla Model 3 Eligible for Full $7,500 Tax Credit 

The InternalRevenue Service has announced that all of the Tesla Model 3 sedans are now eligible for the full $7,500 tax credit under the current tax law passed by the Biden administration tax plan last year. 

The announcement was made by the Internal Revenue Service earlier this week, which brings the total number of EV models eligible for the full tax credits to 22, including some from General Motors Co., Ford Motor Co., and Volkswagen AG. 

Only the performance version of the Model 3 was previously eligible for $7,500 in tax credits. Before Tuesday, the Treasury Department had said the long-range Model 3, which Tesla recently resumed selling, would qualify for only $3,750 in federal tax credits.  

Tesla's Model S and Model X vehicles do not qualify for any tax credit. 

To be eligible for the full $7,500 credit under the Inflation Reduction Act of 2022 (IRA), at least half of the vehicle's battery components
must be made in North America, with 40% of the value of raw materials in the battery extracted from or processed domestically or in countries with U.S. free-trade agreements.