The electric vehicle tax credit, also known as the “clean vehicle tax credit,” or 30D, if you like IRS code, can offer up to $7,500 off the purchase of a new EV. Sounds nice, right?
But of course, it’s not that easy. This is the IRS we’re talking about after all.
Before you can collect your $7,500 credit from the government, there are a few rules that must be satisfied — rules about where the vehicle is made, where the battery is made, where the minerals are processed, the price of the vehicle, your own annual income, and much, much more.
If you thought it would be as easy as walking into a dealership, picking out the EV of your choosing, and collecting your credit, you were sorely mistaken.
The EV tax credit is more than just an incentive to get Americans to ditch their dirty gas-powered cars and replace them with clean, quiet zero-emission vehicles. It’s also an energy security measure aimed squarely at busting up China’s influence over the EV battery industry.
Will it succeed? Automakers are falling over themselves to set up manufacturing operations in North America in order to comply with the rules. And car buyers are making decisions based on which cars are eligible.
In addition to the stories listed below, here are a few resources to help you figure out if the car you want qualifies for the $7,500 credit:
The list of eligible vehicles is very fluid. Cars are being added, removed, and being re-added. It will likely remain this way for a while as the auto industry acclimates to the rules and customers continue to lean toward those vehicles that qualify.
But one thing is for sure: the tax credit will continue to loom large over the industry’s shift to electric. Just be sure to talk to an accountant before you try to claim it.
Good luck finding those 10 EVs that qualify for the $7,500 tax credit right now.
A lot of publications, including the New York Times, are saying 10 models are currently eligible for the tax credit. But that’s bullshit. Three of those vehicles — the Chevy Silverado, Blazer, and Equinox EVs — don’t go on sale until later this year. And a lot of the other vehicles on this list are basically impossible to buy right now. The Cadillac Lyriq is sold out for the rest of the year. The Ford F-150 Lightning is just now returning to production after a battery fire messed things up. In short, nearly half of this list is vaporware. So let’s be real: there’s really only six EVs that qualify.
Tesla raised the price of its Model Y electric vehicle (EV) just hours after the US Treasury Department adjusted its EV tax credit rules, as first reported by Bloomberg. While the Tesla Model Y Long Range now costs $1,500 more at $54,990, the Model Y Performance went up by $1,000 to $57,990, excluding shipping fees.
On Friday, the Treasury Department updated the way it classifies vehicles that qualify for its $7,500 EV tax credit as part of the Inflation Reduction Act (IRA). The change should allow more vehicles — including the Model Y — to qualify for the credit, as it no longer puts certain SUV crossovers in the same category as sedans.
If you were waiting until after New Year to pick up a Tesla Model Y in hopes it’d qualify you for the new federal tax credit, you might be in for a disappointment. The IRS released a 2023 list of vehicles that qualify for the new $7,500 incentive, and while Tesla’s popular SUV is on it, the most common five-seater versions won’t be eligible.
According to EPA classifications, all versions of the Tesla Model Y are supposed to be under the “small SUV” category. But it would seem the IRS is treating five-seater and seven-seater models differently for tax eligibility, the former being treated as a car and the latter as an SUV.
The Biden administration launched a new website — CleanEnergy.gov — aimed at helping Americans navigate the new green energy tax credits contained in the Inflation Reduction Act of 2022 (IRA). That could especially be useful for people looking to buy a new electric vehicle but finding themselves confused by the litany of new requirements about assembly and battery materials.
The $739 billion measure carries a host of tax credits and discounts on everything from EVs to solar energy to regular appliances like refrigerators, stoves, and washing machines. The new website is designed to help Americans save money on home upgrades or new purchases while also steering them toward cleaner, more efficient products.
Congress is poised to approve newly expanded tax credits for electric vehicles, but the rules are written in such a way as to effectively disqualify every EV that’s currently on the market today.
That’s because most EVs run on lithium-ion batteries that are mostly made in China. The nation has a lock on some 76 percent of the battery market today (the US only represents 8 percent). And to get a deal passed in a deadlocked Senate, Democrats agreed to provisions that would require eligible vehicles to use batteries that are made in North America.