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How to claim clean vehicle tax credits

Posted on May 16, 2023

The Inflation Reduction Act of 2022 made several changes to the tax credits provided for qualified plug-in electric drive motor vehicles. It also added fuel cell vehicles to the tax credit act.

As of January 1, 2023, eligible electric vehicles may qualify for a tax credit of up to $7,500.

That said, the amount of the credit depends on when your eligible new clean vehicle is placed in service, and whether or not your vehicle meets specific requirements for a full or partial credit. Those specifics include:

  • As the owner of the vehicle, you must meet certain income limitations.
  • The final assembly of your new clean vehicle must occur within North America.
  • Your vehicle can’t exceed a manufacturer suggested retail price of:
    •  $80,000 for vans, sport utility vehicles and pickup trucks
    •  $55,000 for other vehicles.

Your purchase of said new clean vehicle must be between 2009 and 2022, so even if the purchase isn’t recent, it may qualify for a tax credit.

What if the electric vehicle you purchased wasn’t new?

The IRS also added a credit for used clean vehicles, which can equal 30% percent of the sale price up to a maximum credit of $4,000. However, this recent credit doesn’t apply to used clean vehicles purchased before 2023.

Got more questions? Here’s a list of frequently asked questions about new and used clean vehicle credits that covers:

  •  eligibility rules
  •  income and price limitations
  •  when the new requirements apply, and
  •  claiming the credit.

These credits are nonrefundable, so you can’t get back more on the credit than what you owe in taxes. Plus, you can’t apply any excess credit to future tax years.

For more information, visit IRS.gov:
Manufacturers and Models of Qualified Used Clean Vehicles
Credits for New Electric Vehicles Purchased in 2023 or After
Credits for New Electric Vehicles Purchased in 2022 or Before
Commercial Clean Vehicle Credit
Credits and Deductions Under the Inflation Reduction Act of 2022