Tesla Model X Does Indeed Qualify For $25,000 Hummer Tax Deduction

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Originally published on EV Obsession.

The Tesla Model X is apparently compatible with the much derided (or loved, depending on your stance) $25,000 “Hummer tax deduction” — as the electric SUV has a Gross Vehicle Weight Rating (GVWR) of over 6,000 pounds. We reported on this about a month ago, but now that it’s basically confirmed, we figured it was worth a follow-up.

To be clear here, that means that buyers of the Model X could claim a deduction of $25,000 of the purchase price, so long as they are a small-business owner who will be using the vehicle as “an integral part of … furnishing transportation.”

Tesla Model X Range

A Tesla spokeswoman (Alexis Georgeson) confirmed this option, though with the obvious caveat that a personal tax accountant should be consulted. In an interview with Autoblog, Georgeson stated that a deduction “could be taken for up to $25,000 of the purchase price.”

The caveat: “Tesla always encourages its customers to consult with their personal tax accountant, as each individual’s tax situation may be different and Tesla does not guarantee this deduction.”

When we covered this topic last, just last month, we also noted that the Model S almost qualifies itself, as it weighs 5710 pounds — close enough to give someone a desire for the tax deduction perhaps but not quite enough to actually get it. I guess that’s another big draw of the Model X over the Model S.


Green Car Reports provides a bit more context:

Remember the gas-guzzler tax allowance, nicknamed the “HUMMER deduction” because it allowed small-business owners to buy massive, heavy, fuel-sucking SUVs and deduct a large piece of the cost from their taxes? The HUMMER brand went away as a result of the 2009 GM bankruptcy and government-backed restructuring. But the Section 179 tax credit has had more lives than a TV zombie. The Section 179 deduction allows large capital purchases to be deducted as a business expense, instead of amortized over a number of years.

It first showed up in the Tax Code during the Bush era, with the goal of cutting the cost of purchasing large capital equipment for farmers–think tractors and combine harvesters–as well as other small business people. But the provision was written to allow any vehicle weighing more than 6,000 pounds to qualify.

That let thousands of wealthy white-collar professionals with their own business deduct some or all of the full cost of buying large SUVs, heavy-duty pickup trucks, or (at the time) new HUMMER SUVs.

Those wanting more information on specifics can find them here at the IRS website.

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James Ayre

James Ayre's background is predominantly in geopolitics and history, but he has an obsessive interest in pretty much everything. After an early life spent in the Imperial Free City of Dortmund, James followed the river Ruhr to Cofbuokheim, where he attended the University of Astnide. And where he also briefly considered entering the coal mining business. He currently writes for a living, on a broad variety of subjects, ranging from science, to politics, to military history, to renewable energy.

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