Elon Musk says Tesla will refund customers who don't receive their cars by the time a lucrative tax break is slashed next month

elon muskJames Glover / ReutersTesla CEO Elon Musk tweeted about a cancellation waitlist on Tuesday.James Glover / Reuters

  • The deadline to guarantee Tesla delivery by the time an electric vehicle tax credit gets cut in half was in October.
  • But there may be waitlist spots to get a guarantee before the January deadline, CEO Elon Musk tweeted on Tuesday. 
  • After January 1, the government tax credit will shrink from $7,500 to $3,750. 

A lucrative tax credit available to Tesla buyers will drop by $3,750 on January 1, but there may be some hope for potential customers who missed the October 15 deadline.

CEO Elon Musk tweeted Tuesday that potential buyers can join a cancellation waitlist to possibly take delivery of their vehicle ahead of the credit's reduction on January 1. If the car isn't delivered by then, they can request a full refund.

The US government gives people who buy electric vehicles a tax credit of $2,500 to $7,500, depending on the vehicle's size and battery capacity. As Tesla wrote in an annual report filed with the US Securities and Exchange Committee in February, its customers get the full $7,500.

But two calendar quarters after a company sells its 200,000th electric vehicle in the US, the tax credit begins to phase out. Tesla confirmed to Business Insider in July that it had passed the 200,000-vehicle threshold. It is the first company to have its credits phased out.

Read more: Elon Musk: 'I want to be clear - I do not respect the SEC'

Tesla customers who take delivery between January 1 and June 30, 2019, will receive a $3,750 tax credit and those who take delivery between July 1 and December 31, 2019, will receive $1,875. Customers who take delivery beginning in 2020 will not receive a federal tax credit.

That means those who are waiting for the $35,000 base-priced version of Tesla's Model 3 sedan will not be eligible for the full tax credit, since Tesla says on its website that configurations of the Model 3 with a standard battery will become available beginning in three to six months. The least expensive Model 3 currently available starts at $49,000.

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