State EV tax credits and the specific battery requirements can vary significantly by state, but the most detailed and widely applicable battery requirements come from federal tax credits. While states may have their own programs, the federal requirements are a common reference:
- Federal Requirements: The federal tax credit for electric vehicles does involve battery requirements, specifically focusing on battery capacity and sourcing. Vehicles must have a certain percentage of their batteries assembled or manufactured within North America, with increasing percentages required over the years (e.g., 60% in 2025). Additionally, there’s a “critical minerals requirement” for critical minerals in the battery to be extracted or processed within the U.S. or a country with a free-trade agreement.
- State Credits: State-level incentives can vary widely and often do not specifically focus on battery requirements like the federal program. Instead, they may offer rebates or exemptions from certain fees to encourage EV adoption. For example, California offers rebates for electric vehicles without specific battery capacity requirements, while other states might offer exemptions from state sales tax or other benefits.
In summary, while the federal tax credit includes specific battery-related requirements, state-level credits typically focus more on overall vehicle eligibility and less on detailed battery specifications.
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