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Electric Vehicle Tax Credit (EVTC) 2024: How much is it, requirements, who qualifies, and how to claim it to the IRS

All the important information on the 2024 EVTC, a tax credit aiming to help the environment and consciousness purchasers.

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The Electric Vehicle Tax Credit (EVTC) is a significant incentive for consumers considering the purchase of an electric vehicle (EV). This article gives an overview of the EVTC for 2024, including the amount of the credit, the requirements, who qualifies, and how you can claim it.

How much is the Electric Vehicle Tax Credit?

For 2024, the federal tax credit for new electric vehicles can be up to $7,500. This amount is divided into two parts:

  • $3,750 for meeting critical mineral requirements.
  • $3,750 for meeting battery component requirements.

Used electric vehicles also qualify for a tax credit, which can be up to $4,000 or 30% of the vehicle’s sale price, whichever is lower.

List of car makes that qualify for EVTC and their Tax Credit Amount.

The following list is a list of car makes that are eligible for EVTC and their tax credit amounts:

  • 2024 Acura ZDX EV – $7,500
  • 2023-24 Audi Q5 PHEV – $3,750
  • 2024 Cadillac Lyriq EV – $7,500
  • 2024 Chevrolet Blazer EV – $7,500
  • 2022-23 Chevrolet Bolt EV – $7,500
  • 2022-23 Chevrolet Bolt EUV EV – $7,500
  • 2024 Chevrolet Equinox EV – $7,500
  • 2022-24 Chrysler Pacifica PHEV – $7,500
  • 2022-24 Ford Escape PHEV – $3,750
  • 2022-24 Ford F-150 Lightning EV – $7,500
  • 2024 Honda Prologue – $7,500
  • 2022-24 Jeep Grand Cherokee 4xe PHEV – $3,750
  • 2022-24 Jeep Wrangler 4xe PHEV – $3,750
  • 2022-24 Lincoln Corsair Grand Touring PHEV – $3,750
  • 2024 Nissan Leaf EV – $3,750
  • 2022-24 Rivian R1S Quad Large EV – $3,750
  • 2023-24 Rivian R1S Dual Large EV – $3,750
  • 2024 Rivian R1S Dual Standard, Dual Standard+, Performance Dual Standard+ EV – $3,750
  • 2022-24 Rivian R1T Quad Large EV – $3,750
  • 2023-25 Rivian R1T Dual Large EV – $3,750
  • 2023-24 Rivian R1T Dual Max EV – $3,750
  • 2023 Rivian R1T Dual Performance Large EV – $3,750
  • 2024 Rivian R1T Dual Standard, Dual Standard+, Performance Dual Standard+ EV – $3,750
  • 2024 Tesla Model 3 Long Range All-Wheel Drive EV – $7,500
  • 2023-24 Tesla Model 3 Performance EV – $7,500
  • 2023-24 Tesla Model X Long Range EV – $7,500
  • 2023-24 Tesla Model Y EV – $7,500
  • 2024 Tesla Model Y Rear-Wheel Drive, Long Range Rear-Wheel Drive EV – $7,500
  • 2023-24 Volkswagen ID.4 EV – $7,500

Requirements for the Electric Vehicle Tax Credit

To qualify for the EVTC, both the vehicle and the buyer must meet specific criteria:

  • Vehicle requirements:
    • Battery capacity: The vehicle must have a battery capacity of at least 7 kilowatt-hours.
    • Weight: The vehicle must have a gross vehicle weight rating of less than 14,000 pounds.
    • Manufacturing: The vehicle must be made by a qualified manufacturer and undergo final assembly in North America.
    • Price caps: The price of a new car must be $55,000 or less, and the price of a new truck, van, or SUV must be $80,000 or less.
  • Buyer requirements:
    • Income limits: The buyer’s modified Adjusted Gross Income (AGI) must not exceed $300,000 for married couples filing jointly, $225,000 for heads of households, and $150,000 for all other filers.

Who qualifies for the Electric Vehicle Tax Credit?

To qualify for the EVTC, the following conditions must be met:

  • New vehicles:
    • The vehicle must be purchased new from a qualified manufacturer.
    • The vehicle must meet the battery capacity, weight, and manufacturing requirements mentioned above.
  • Used vehicles:
    • The vehicle must be at least two years old.
    • The sale price must be $25,000 or less.
    • The vehicle must be purchased from a dealer.
    • The buyer must not have claimed a used EV credit in the previous three years.

How to claim the Electric Vehicle Tax Credit

Claiming the EVTC involves several steps:

  • Purchase the Vehicle:
    • Ensure that the vehicle meets all the necessary requirements and that your income is within the specified limits.
  • File Form 8936:
    • When filing your federal income taxes, complete IRS Form 8936, “Qualified Plug-in Electric Drive Motor Vehicle Credit”. This form requires information about the vehicle, including the Vehicle Identification Number (VIN).
  • Transfer the Credit:
    • Starting in 2024, buyers have the option to transfer the tax credit to the dealership at the point of sale. This allows the dealer to reduce the vehicle’s purchase price by the amount of the credit, providing an immediate discount.
  • Submit your Tax Return:
    • Include Form 8936 with your federal tax return. The credit is nonrefundable, meaning it can reduce your tax liability to zero, but any excess credit will not be refunded.

Understanding the Electric Vehicle Tax Credit

The Electric Vehicle Tax Credit for 2024 offers substantial financial incentives for purchasing new and used electric vehicles. By understanding the amount of the credit, the requirements, who qualifies, and how to claim it, consumers can make informed decisions and take advantage of these benefits. Whether you are considering a new or used EV, the EVTC can significantly reduce the cost and make the transition to electric driving more affordable.

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