What does this funding get me?
Individuals can get a credit of up to $7,500 on a new EV, $4,000 on a used EV, and $1,000 on an EV charger. Businesses and tax-exempt entities can get up to $7,500 on a new EV, up to $40,000 on new EVs larger than 14,000 pounds, and up to $100,000 on chargers. Only chargers installed in low-income or non-urban areas are eligible for the credit. As of January 1, 2024, individuals can receive the EV credit at point of sale. See details below.
Am I eligible?
This table shows the amount of tax credit you can receive. The dealer must report your purchase to the IRS and must provide you with a statement of the vehicle’s eligibility for the credit. The IRS advises buyers to obtain a copy of the IRS’s confirmation that a “time-of-sale” report was submitted successfully by the dealer.
Individuals, see “How can I access the money?” below for information on the option of transferring the credit to the EV dealer.
| CREDIT | DETAILS |
| New EVs, plug-in hybrids and fuel cell vehicles under 14,000 lbs. (individuals) | $3,750 or $7,500 depending on what domestic content requirements are met |
| Used EVs, plug-in hybrids and fuel cell vehicles under 14,000 lbs. (individuals) | Lesser of 30% of sale price or $4,000; no domestic content requirements |
| EVs under 14,000 lbs. (commercial/nonprofit) | Lesser of incremental cost or 30% of basis (15% if the vehicle is powered in part by gas or diesel),* $7,500 limit; no domestic content requirements |
| EVs over 14,000 lbs. (commercial/nonprofit) | Lesser of incremental cost or 30% of basis (15% if the vehicle is powered in part by gas or diesel),* $40,000 limit; no domestic content requirements |
| Level 2 EV chargers (individuals) | 30% of the cost, up to $1,000, must be in non-urban or low-income area; Treasury Department fact sheet |
| Level 2 EV chargers or DC fast chargers (commercial/nonprofit) | 30% up to $100,000 if wage & apprenticeship requirements are met (otherwise, 6%); must be in non-urban or low-income area; Treasury Department fact sheets for businesses / nonprofits |
New car requirements
To be eligible, sedans must have a manufacturer’s suggested retail price of $55,000 or less; and vans, SUVs, and pick-up trucks must have a manufacturer’s suggested retail price of $80,000 or less.
The credit is not available for taxpayers with a modified adjusted gross income exceeding:
- $300,000 for married filing jointly
- $225,000 for heads of household
- $150,000 for all other filers
You must buy the vehicle for your own use, not for resale, and you must use it primarily in the U.S.
See this IRS web page and this DOE web page for details on eligibility requirements and a list of what cars qualify for what level of credit.
Since businesses are not subject to the domestic content requirements, it is possible that an individual could lease an EV and obtain a higher credit than the particular vehicle would otherwise be eligible for. This would depend on the lessor’s willingness to share the benefit of the higher credit with you.
Used car requirements
Available to individual taxpayers only, not to businesses. Vehicle must be purchased from a dealer and sale price cannot exceed $25,000.
The credit is not available for taxpayers with a modified adjusted gross income exceeding:
- $150,000 for married filing jointly
- $112,500 for heads of households
- $75,000 for all other filers
See this IRS web page and this DOE web page for more details on requirements.
Commercial EV requirements
Vehicle must be made by a “qualified manufacturer.” See more requirements and other information on this IRS FAQ page, Topic G.
How can I access the money?
If you purchased an eligible EV or installed eligible charging infrastructure in 2023, you will claim the EV or charger credit when you file your 2023 tax return. Beginning January 1, 2024, individual EV purchasers have the option of instead transferring the EV credit to the dealer (see below).
For commercial/nonprofit credits
Check this IRS page to find out how to claim the EV credit. Nonprofits will receive the credit as a direct payment. For-profits can carry forward unused portions of the credit to future years’ tax returns. Commercial/nonprofit credits cannot be transferred to the dealer.
To claim the credit for installing charging infrastructure, submit Form 8911 when you file your tax return for the year in which you installed the equipment. Nonprofits will receive the credit as a direct payment. For-profits may be able to transfer any unused portion of the charger credit to another business taxpayer.
To determine if your charger is located in an eligible census tract:
- if filing before November 15, 2024: use the Department of Energy map here or the IRS worksheet and map links here
- If filing after November 15, 2024:
- determine your 11-digit census tract geographic identifier (GEOID) under the 2020 census tract boundaries using the Census Bureau mapping tool. See if your identified GEOID is included in the IRS-provided list here: Appendix B;
- if your property is placed in service prior to January 1, 2025, you may also determine your 11-digit GEOID under the 2015 census tracts boundaries. If you use the 2015 census tract boundaries, see if your 2015 GEOID is eligible in Appendix A.
Note that your credit may be reduced if the total of tax credits, grants, and forgivable loans that you receive for the project exceeds the project cost.
For individual credits
File Form 8936. Unused tax credits cannot be carried forward to future years’ tax returns.
However, beginning January 1, 2024, you can either claim the credit on your tax return or you can transfer the credit to the dealer who sells you the vehicle, as long as your dealer has registered with the IRS to receive the credit on your behalf. In other words, you would receive the credit immediately from the dealer (in cash or to satisfy part of the downpayment) instead of waiting to claim the credit until you file your tax return. This also means you get the full amount of the credit regardless of how much tax you owe.
If you transfer the credit to your dealer, you must still file Form 8936 to report it. For more details on transferring your credit to the dealer, see this fact sheet regarding information the dealer must provide to you, Topic H on this IRS FAQ page, or these even more detailed procedural rules.
To claim the credit for installing charging infrastructure, submit Form 8911 when you file your tax return for the year in which you installed the equipment.
To determine if your charger is located in an eligible census tract:
- if filing before November 15, 2024: use the Department of Energy map here or the IRS worksheet and map links here
- If filing after November 15, 2024:
- determine your 11-digit census tract geographic identifier (GEOID) under the 2020 census tract boundaries using the Census Bureau mapping tool. See if your identified GEOID is included in the IRS-provided list here: Appendix B;
- if your property is placed in service prior to January 1, 2025, you may also determine your 11-digit GEOID under the 2015 census tracts boundaries. If you use the 2015 census tract boundaries, see if your 2015 GEOID is eligible in Appendix A.
What is the timeline?
These credits are available from now through 2032. Starting January 1, 2024, individuals have the option of receiving EV credits either direct from the dealer or on your tax return.
What other incentives could I use to help me accomplish my goals?
For school buses, check out the EPA’s Clean School Bus grants and rebates.
State, local, and Tribal governments can apply for the Charging & Fueling Infrastructure Discretionary Grant to install EV chargers in communities and along transportation corridors.
Duke Energy customers in North and South Carolina who install charging infrastructure may be eligible for a rebate of certain costs incurred to prepare their site for the installation (e.g., new outlets or wiring). Details here for non-residential customers and here for residential.
Randolph Electric Membership Corporation (NC) has a pilot program offering $500 rebates on Level 2 chargers and other programs to support EV drivers. Learn more.
Cape Hatteras EMC (NC) offers a $100 rebate to customers who install ChargePoint Level 2 chargers. Details here.
Check the Database of State Incentives for Renewables & Efficiency (DSIRE) for additional incentives that may be offered by your state, local government, or utility, as well as important federal, state, and local policies. For questions regarding DSIRE, contact Justin Lindemann (NC Clean Energy Technology Center) at jplindem@ncsu.edu.
Where can I get more information?
- Make sure you check the links provided above for details on various points
- IRS web page on clean vehicle credits
- IRS Frequently Asked Questions (FAQ) on clean vehicle credits
- IRS FAQ on census tracts eligible for EV charger credits
- IRS page on commercial clean vehicle credit
- IRS rules for credits on EV chargers
- Details on definitions of census tracts eligible for charger credit
- DOE web pages on tax credits for new EVs and used EVs
- Full text of latest proposed rulemaking regarding these credits (9/19/24)
- Rewiring America’s tax credit calculator includes useful information on credits for EVs, chargers, and other home upgrades. *Due to Rewiring America’s changed privacy policy, any data you input may be sold to third parties.
- IRS page listing all direct pay credits available to tax-exempt organizations
- FAQ on direct pay for nonprofits and transferability for businesses
- You can register for IRS office hours on Oct. 2, 2024 at 1pm EDT
- Lawyers for Good Government (L4GG) provides a Clean Energy Tax Navigator to help tax-exempt entities access direct pay tax credits. L4GG also offers pro bono assistance to underresourced organizations that need more help after using the navigator.
- Electrify My Ride resources from Generation 180 (and a separate North Carolina resource page)
- Sierra Club Shopping Guide for Healthy & Affordable Home Upgrades
- The NC Clean Energy Technology Center provides technical assistance services related to clean transportation technologies. Click here for more information.
- For specific questions or for more assistance, contact Sally Robertson at info@energyfundsforall.org. Please note this contact is not a certified tax professional.
Testimonial
Hear from Vickie Atkinson and Ped Frazier, a couple in Chatham County that received $9000 in tax credits for a plug-in hybrid vehicle and charging station that reduced both their fuel costs and their greenhouse gas emissions.