Volkswagen Confirms ID.4 Eligibility for Full $7,500 US Tax Credit, But With Important Caveats

If you have been eyeing the Volkswagen ID.4 in the US, you might want to pull the plug this year as the EV maker has confirmed the car qualifies for the full US tax credit, meaning you can potentially save $7,500.

If you are leaning towards the ID.4, you may get the tax credit thanks to the battery cells being manufactured in the US by SK On in Georgia. Not all EV makers made the list for the whole tax incentive last year, and Volkswagen was the only non-local automaker to qualify. The 2023 ID.4 was assembled in Tennessee.

There are some caveats, however, as not all ID.4 buyers will get the full incentive. This is because not all the battery cells are made in the US. Volkswagen agreed to source some batteries from LG Chem which are not made in the US. As such, any 2023 ID.4 (known as MY23 ID.4) with LG-made battery cells will not get the full $7,500 tax incentive. Buyers might want to ascertain the battery source before committing to a purchase.

The case of the 2024 ID.4 (known as MY24 ID.4) is even less certain as Volkswagen admitted that they will have batteries that the source has not been confirmed yet. However, the company expresses optimism that buyers would be able to take full advantage of the Federal Tax Credit.

The ID.4 ended 2023 as the fifth-best-selling EV in the US, with sales jumping by 84%. However, the record might be blighted by a recall involving about 27,000 ID.4 due to inflammable sunshades in the US and Canada.

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