How to Claim the EV Tax Credit

As electric vehicles (EVs) continue to grow in popularity, the U.S. government offers incentives to encourage their adoption. The EV tax credit is a key benefit for buyers, helping reduce the cost of purchasing a new or used electric vehicle. If you’re considering an EV in 2024, here’s what you need to know about claiming the tax credit.

Understanding the EV Tax Credit

The federal EV tax credit, officially known as the Clean Vehicle Credit, was expanded under the Inflation Reduction Act of 2022. The credit provides up to $7,500 for new EVs and up to $4,000 for qualifying used EVs. However, specific requirements must be met to claim this credit.

Eligibility Requirements

To qualify for the EV tax credit in 2024, you must meet the following criteria:

Vehicle Requirements:
- The vehicle must be assembled in North America.
- It must meet critical mineral and battery component sourcing requirements.
- The manufacturer’s suggested retail price (MSRP) must not exceed $80,000 for SUVs, trucks, and vans or $55,000 for other vehicles.
Income Limits:
- Your modified adjusted gross income (MAGI) must be $150,000 or less for single filers, $225,000 or less for heads of household, and $300,000 or less for joint filers.
Dealership Requirement:
- Starting in 2024, you can transfer the tax credit directly to the dealer at the time of purchase, reducing the vehicle’s upfront cost.
Used EV Credit:
- The used EV must be at least two years old and priced under $25,000.
- The credit is 30% of the purchase price (up to $4,000).
- The buyer’s income must be $75,000 or less for single filers, $112,500 or less for heads of household, and $150,000 or less for joint filers.