Get $7,500 When You Buy a New EV with the EV Tax Credit

If you bought an EV or plugin hybrid in 2022, you are likely eligible for up to $7,500 in tax credits. We say likely because there are a few stipulations based on your income and the make/model. 

This tax credit is also good for 2023, meaning it’s not too late to reap the tax benefits of an EV purchase. If you purchase a qualifying EV this year, you can file for the EV tax credit next year. And starting in 2023, you can also qualify for up to $4,500 in tax credit for the purchase of a used EV.

A consumer reports survey from last year showed that more than 50% of buyers are more likely to buy an electric vehicle if it comes with a hefty tax credit. 

The US government began incentivizing the purchase of EVs in the 2010s. And the most recent package of incentives in the 2022 Inflation Reduction Act is the most lucrative yet. 

How Do I Get the EV Tax Credit?

Navigating the bureaucracy of the EV tax credit might seem a little confusing on the surface. But with a little research, the help of a good car salesman, and some patience during tax season, you could get up to $7,500 back on your federal taxes. 

It’s honestly easier than it seems.

The tax credit is an extension of a previously existing credit, but the most significant change is that all new qualifying vehicles must be assembled in North America. That means many foreign manufacturers aren’t capable of making qualifying vehicles right now (though most are working to remedy this).

After purchasing a qualifying vehicle, be sure to keep your documents in a safe place until tax season. When you fill out your taxes, remember to let your accountant, tax filer, or TurboTax know about your purchase.

New EV Tax Credit Requirements at a Glance

• Income less than $300,000 family.
• Income less than $150,000 individual.
• Vehicle purchase price under $55,000 (cars)
• Purchase price under $80,000 (larger vehicles)
• Vehicle underwent final assembly/inspection in North America

Which Vehicles Qualify

You can find out if the car you’re thinking of purchasing was assembled in North America using this VIN Decoder from the US Department of Transportation. 

We also compiled a handy list of all the vehicles currently listed by the IRS as qualifying.

The tax credit also comes with income stipulations and is only available to US families who make less than $300,000 per year (or $150,000 married filing jointly). But that includes something like 90% of US households.