Beginning January 1, 2023, a number of electric vehicles were once again eligible for the $7,500 tax credit, which took effect a year ago as part of the $430 billion Inflation Reduction Act.
Some new models on the list became ineligible when their manufacturer reached the previous credit’s 200,000 vehicle sales limit (Tesla models, Chevy Bolts). Others have recently moved production to North America and meet one of the critical requirements (VW ID.4).
There is still a lot up in the air right now
There’s still a lot up in the air at the moment – the Treasury Department has set a March deadline for releasing guidance on some of the thornier issues surrounding battery material procurement and other rules that could drastically reduce the eligibility list if they are passed – but for now, these are the EVs that qualify.
Foreign automakers are pressuring the Biden administration to give them a piece of the action, while Senator Joe Manchin (D-WV) threatens to block implementation in an effort to prevent companies from exploiting loopholes. And the CEO of Tesla Elon Musk wails about how it’s “confused” that certain versions of the Tesla Model Y that exceed the $80,000 price cap don’t qualify, while a bunch of hybrid Jeeps do.
In short: if you are not sure whether the new electric car you have your eye on qualifies for the credit, talk to an accountant. Every state has at least a few CPAs who are familiar with the craziness of EV tax credits and can help you navigate the murky waters ahead. They can also tell you what government incentives, if any, are available.
This list is a good start, but don’t think about the last word.
Eligible EV for the $7,500 tax credit