New EV Tax Credit

Who Qualifies
You may be eligible for a credit up to $7,500 under Internal Revenue Code Section 30D if you purchase a new, qualified plug-in electric vehicle (EV) or fuel cell electric vehicle (FCV). The Inflation Reduction Act of 2022 updated the rules for this credit for vehicles purchased from 2023 to 2032.

The credit is available to individuals and businesses.

To qualify, you must:

• Buy the vehicle for personal use, not resale
• Use it primarily in the U.S.
  Additionally, your modified adjusted gross income (AGI) cannot exceed:
• $300,000 for married couples filing jointly or a surviving spouse
• $225,000 for heads of households
• $150,000 for all other filers

You can use your modified AGI from the year you take delivery of the vehicle or the previous year, whichever is lower. If your AGI is below the threshold in either year, you can claim the credit.

The credit is nonrefundable and cannot exceed your tax liability. Any excess credit cannot be carried over to future years.

Credit Amount
The credit amount depends on when you place the vehicle in service (take delivery), regardless of the purchase date.

• For vehicles placed in service from January 1 to April 17, 2023:
  • $2,500 base amount
  • Plus $417 for a vehicle with at least 7 kilowatt hours of battery capacity
  • Plus $417 for each additional kilowatt hour of battery capacity beyond 5 kilowatt hours
  • Up to a total of $7,500

In general, the minimum credit will be $3,751 ($2,500 + 3 x $417), for vehicles with at least 7 kilowatt hours of battery capacity.

• For vehicles placed in service on April 18, 2023, and after:
  • The vehicle must meet new critical mineral and battery component requirements to qualify for the credit.
  • $3,750 if the vehicle meets the critical minerals requirement
  • $3,750 if the vehicle meets the battery components requirement
  • $7,500 if the vehicle meets both requirements

A vehicle that does not meet either requirement will not be eligible for the credit.

Qualified Vehicles

To qualify, a vehicle must:

• Have a battery capacity of at least 7 kilowatt hours
• Have a gross vehicle weight rating of less than 14,000 pounds
• Be made by a qualified manufacturer
• Undergo final assembly in North America
• Meet critical mineral and battery component requirements (as of April 18, 2023)

The sale qualifies only if:

• The vehicle is purchased new
• The seller reports required information to you and the IRS
• The seller provides your name and taxpayer identification number to the IRS for eligibility

Additionally, the vehicle's manufacturer suggested retail price (MSRP) cannot exceed:

• $80,000 for vans, SUVs, and pickup trucks
• $55,000 for other vehicles

MSRP includes the retail price suggested by the manufacturer, including options, accessories, and trim but excluding destination fees. It may not reflect the actual price you pay.

You can find your vehicle’s weight, battery capacity, final assembly location (listed as "final assembly point"), and VIN on the vehicle's window sticker.

4o mini 

Who Qualifies
You may be eligible for a credit for purchasing a previously owned, qualified plug-in electric vehicle (EV) or fuel cell vehicle (FCV), including cars and light trucks, under Internal Revenue Code Section 25E.

To qualify, you must:

• Be an individual who purchased the vehicle for personal use (not for resale)
• Not be the original owner
• Not be claimed as a dependent on another person's tax return
• Not have claimed another used clean vehicle credit in the past 3 years

Additionally, your modified adjusted gross income (AGI) must not exceed:

• $150,000 for married couples filing jointly or a surviving spouse
• $112,500 for heads of households
• $75,000 for all other filers

You can use your modified AGI from the year you take delivery of the vehicle or the previous year, whichever is lower. If your income is below the threshold for one of those years, you can claim the credit.

For more details, see Publication 5866-A, Used Clean Vehicle Tax Credit Checklist PDF.

Qualified Vehicles and Sales
To check if a vehicle qualifies for the used clean vehicle credit:

To qualify, a vehicle must meet all of the following criteria:

• Have a sale price of $25,000 or less (this includes dealer-imposed costs, but not legally required fees like taxes or title/registration fees)
• Be from a model year at least 2 years earlier than the calendar year you purchase it (e.g., a vehicle purchased in 2023 must be a 2021 model or older)
• Not have been transferred to a qualified buyer after August 16, 2022
• Have a gross vehicle weight rating of less than 14,000 pounds
• Be an eligible FCV or plug-in EV with a battery capacity of at least 7 kilowatt hours
• Be used primarily in the U.S.

The sale qualifies only if:

• You purchase the vehicle from a licensed dealer
• For qualified used EVs, the dealer reports the required information to you and the IRS

A dealer is any person licensed to sell motor vehicles in a U.S. state, the District of Columbia, Puerto Rico, or any U.S. territory, including Indian tribal governments and Alaska Native Corporations.

Required Information includes:

• Dealer's name and taxpayer ID number
• Buyer's name and taxpayer ID number
• Sale date and sale price
• Maximum credit allowable under IRC 25E
• Vehicle identification number (VIN), unless the vehicle doesn’t have one
• Battery capacity