Before you buy that Electric Vehicle : What You Need to Know to Get the Credit!

Know Before You Go: The Rules for Securing an Electric Vehicle Tax Credit!

Warning & Update  Starting in January 2024

The IRS is allowing you to give your tax credit to the car dealer at the time you purchase the electric vehicle. That is a nice perk to help lower the cost  of vehicle without waiting BUT...

Not everyone qualifies for the full $7,500 tax credit.  Make sure you do or Uncle Sam could be hitting you with a big tax bill on April 15th.

 

The rules depend on if you are buying a new or used.  Not knowing could cost you thousands in tax savings.

 

NEW VEHICLES

Before you go any further, have you passed BOTH of these tests? If you fail either test, NO credit!

Test 1
The vehicle's manufacturer suggested retail price (MSRP) can't exceed:

    • $80,000 for vans, sport utility vehicles, and pickup trucks

    • $55,000 for other vehicles

Test 2
In addition, your modified adjusted gross income (AGI) must be less than:

    • $300,000 for married couples filing jointly

    • $225,000 for heads of households

    • $150,000 for all other filers

If you have passed both of these tests, does the vehicle qualify? Well, maybe there are a few more rules based on the model you purchased. Click here to learn all the rules: New Vehicle Link

USED VEHICLES

Before you go any further, have you passed all of these tests? If you fail any of these tests, NO credit!

Test 1
It must have a sale price of $25,000 or less.

Test 2
You must buy the vehicle from a dealer.

Test 3
You have NOT claimed another used clean vehicle credit in the three years before the purchase date. (If you took the credit on a previous new electric vehicle in the last 3 years.)

Test 4
In addition, your modified adjusted gross income (AGI) may not exceed:

    • $150,000 for married filing jointly or a surviving spouse

    • $112,500 for heads of households

    • $75,000 for all other filers

If you have passed all of these tests, does the vehicle qualify? Well, maybe there are a few more rules based on the model you purchased. Click here to learn all the rules: Used Vehicle Link"