Effective April 18, 2023, there are new requirements to qualify for a federal clean vehicle tax credit. We’ve highlighted some of these changes in the article below.
Under Internal Revenue Code Section 30D, you may qualify for a credit up to $7,500 if you purchase a new, qualified plug-in electric vehicle or fuel cell electric vehicle (FCV).
Requirements for vehicles placed in service April 18, 2023 or after:
- The credit is available to individuals and businesses.
- The vehicle needs to be purchased new for your own use, not for resale, and primarily within the US.
- In the year of delivery, or the year before, your modified adjusted gross income (AGI) may not exceed: $300,000 for married filing jointly, $225,000 for heads of household, and $150,000 for all others. If your modified AGI is below these amounts in either of those years, you can claim the credit.
- The vehicle must have final assembly in the US, which can be verified with the VIN online: https://afdc.energy.gov/laws/electric-vehicles-for-tax-credit.
- The vehicle’s manufacturer suggested retail price (MSRP) cannot exceed $80,000 for vans, SUVs, and trucks, or $55,000 for other vehicles.
The credit is up to $3,750 if the vehicle meets the critical mineral requirements only, $3,750 if the vehicle meets the battery component requirements only, and up to $7,500 if the vehicle meets both.
To discuss the legislation in detail or inquire about a vehicle you’re considering purchasing, please reach out to the CWDL Tax Team at [email protected].