Now that’s an interesting edge case I hadn’t heard of. Thanks for that.

The people most likely to be in this situation are elderly and retired. If you are over 65 you get an additional standard deduction, and another for your spouse if you are married. If either or both are disabled, additional deductions. A lot of your income is probably coming from Social Security, which is tax exempt at lower income levels. And you probably own your house outright by now, meaning no house payments. The bottom line is that you might be in excellent financial shape to buy that car, and would like the advantages of low operating and maintenance expenses, but you don’t pay anywhere near $7,500 a year in income tax so you lose a lot of the tax credit. The same logic may also apply to state tax benefits, though some of those are refundable or given as rebates rather than tax credits.

If the model you want is available used, it’s probably simpler to look for one of those instead. The used car price will be far below the list price because it’s based on what the original buyer actually paid after getting the tax credit. (That’s one reason why the depreciation on EVs looks particularly steep; much of it is an illusion.) But a lot of those cars haven’t been on the market long enough; good luck finding a used Chevy Bolt, Tesla Model 3, the new longer-range version of the Nissan Leaf, and so on.