If you recently purchased an electric vehicle, or if you’re thinking about buying one soon, its important to know which tax credits you are eligible for. There is a federal electric car tax credit, as well as some that are available at the state level. If you are undecided as to which vehicle to buy, note that there are also some tax credits available for plug-in hybrid electric vehicles, but these are often lower than those available for fully electric cars.
To qualify for the federal electric vehicle tax credit, the car must meet a number of criteria:
1) The vehicle must be made by a manufacturer, meaning that to qualify you cannot take a conventional vehicle and covert it.
2) The vehicle must be treated as a motor vehicle for purposes of title II of the Clean Air Act.
3) The vehicle must have a gross vehicle weight rating (GVWR) of 14,000 pounds or less (all electric cars should have a GVWR less than 14,000 pounds).
4) The vehicle must be propelled to a significant extent by an electric motor which gets its energy from a battery with a capacity of 4 kilowatt hours (kWh) or more that can be recharged using an external source of electricity (in other words, it must be an electric vehicle that can be plugged-in to charge).
5) The vehicle must be new.
6) The vehicle must be acquired for use or lease by the taxpayer, and not for resale (otherwise dealers would be able to apply for the credit).
7) The vehicle must be used mostly in the United States.
8) The vehicle must be placed in service by the taxpayer during or after the 2010 calendar year.
The amount of the tax credit for is determined by the size of the battery, and the number of vehicles sold. Vehicles with a 4 kWh battery receive a credit of $2,500, plus $417 for each kWh of battery capacity over 4 kWh, up to the total maximum of $7,500. Only the first 200,000 of each model sold after December 31st, 2009 qualify for the full credit before it starts to be phased out, however as of yet no electric vehicle has reached this threshold.
Federal electric car tax credits:
Year / Make / Model Tax Credit Amount
2012 AMP Electric Vehicles GCE Electric Vehicle $7,500
2012 AMP Electric Vehicles MLE Electric Vehicle $7,500
2014 BMW i3 Sedan $7,500
2012-2014 BYD Motors e6 Electric Vehicle $7,500
2010 & 2012 CODA Automotive Sedan $7,500
2010 Electric Mobile Cars E36 7 Passenger Wagon $7,500
2010 Electric Mobile Cars E36t Pick-up Truck $7,500
2010 Electric Mobile Cars E36v Utility Van $7,500
2013–14 Fiat 500e $7,500
2012–14 Ford Focus EV $7,500
2011-2012 Ford/Azure Dynamics Transit Connect EV $7,500
2014–15 Chevrolet Spark EV $7,500
2014 Mercedes-Benz B-Class EV $7,500
2012 & 2014 Mitsubishi i-MiEV $7,500
2011–15 Nissan Leaf $7,500
2011 & 2013–15 smart fortwo electric vehicle (coupe/cabriolet) $7,500
2012–14 Tesla Model S $7,500
2008–11 Tesla Roadster $7,500
2011 Think City EV $7,500
2012–14 Toyota RAV4 EV $7,500
2015 Volkswagen e-Golf $7,500
2011 Wheego LiFe $7,500
Please note that these are non-refundable tax credits, and not a rebate. In order to claim them all, your tax liability must be more than $7,500. The credits cannot be used to generate a refund, though it may be possible to work around this by leasing the car and having the credits claimed by the company you lease from (as the leasing company would be the actual owner).
For more information on the federal tax credits, visit http://www.fueleconomy.gov/feg/taxevb.shtml and http://www.afdc.energy.gov/laws/fed_summary.
Depending on your state, there may be additional refunds or tax credits available for the purchase or lease of an electric vehicle.