Beginning on January 1, 2023, the Federal EV (Electric Vehicle) tax credit is available to new and pre-owned electric vehicle purchasers on qualifying EVs. The EV tax credit is a fantastic way to offset the cost of an electric vehicle, but it’s important to understand how it works before making your purchase.
The first thing to know about the EV tax credit is that it is available to anyone who meets the income qualifications, regardless of where they live in the U.S. For a vehicle to qualify, it must be powered by an electric motor that draws energy from a battery, and meet point of final assembly, battery component, and battery source mineral requirements. A new vehicle may qualify for up to a $7,500 tax credit, while a pre-owned vehicle may qualify for up to $4,000.
Some states, including Colorado, also offer additional incentives to EV buyers. These can include tax credits, rebates, and other perks like reduced registration fees and fee-free access to HOV lanes.
The federal EV tax credit is a great way to reduce the overall cost of an electric vehicle. With the right information, perspective EV buyers can save thousands of dollars on their electric vehicle purchase.