The EV tax credit has a few requirements that impact if you and/or the specific make and model you choose qualify. To qualify, the following requirements must be met:
- Your adjusted gross income must be below a certain threshold
- A new or used EV must be below a specific price cap
- A new EV must meet certain assembly requirements
- A used EVs must meet certain age and transfer requirements
- A new or used EV must meet certain sourcing requirements
Adjusted gross income
Taxpayers's adjusted gross income (AGI) must be below the following thresholds to be eligible for the new and used EV car credit:
Price cap
If your AGI is below the thresholds listed above, then you qualify if you select an EV that meets the following MSRP (manufacturer's suggested retail price). MSRP is the retail price of the automobile suggested by the manufacturer, including options, accessories and trim but excluding destination fees. It does not include taxes or other fees added on by the dealer.
[New EVs] Assembly requirements
EVs must have final assembly within North America. When purchasing the car, ask the seller to confirm where it was assembled. You can also check the National Highway Traffic Safety Administration’s VIN database to find a specific car’s final assembly details.
[Used EVs] Age and transfer requirements
Used EVs have a few additional requirements to qualify:
- Car model must be at least 2 years old
- Must be the first transfer of a vehicle
[New and Used EVs] Sourcing requirements
EVs must contain battery and critical minerals sourced from specific parts of the world. Manufacturers are quickly adjusting operations to match these requirements, so the list of cars that qualify is changing rapidly. For the most up to date list, check out the IRS's website:
If your AGI qualifies you for the EV tax credit, and the make and model meet all the requirements above, then you can expect to deduct the following amounts on your taxes:
If you have questions about whether or not you and the car you want qualify, reach out to us at support@canopyclimate.com.
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