When it comes to claiming the tax credit for an electric vehicle (EV), the rules differ between purchasing and leasing. Here’s how it works for both scenarios:
Purchasing an EV
- Eligibility Requirements: To qualify for a federal tax credit of up to $7,500 when purchasing an EV, several conditions must be met:
- The vehicle must be made in North America.
- Battery components and minerals must meet specific sourcing requirements.
- The vehicle must be priced under a certain threshold.
- The buyer’s income must not exceed a certain amount.
- Tax Credit Claim: The buyer can claim the tax credit if they meet these conditions.
Leasing an EV
- Eligibility and Classification: Leased EVs are classified as “commercial vehicles” under the Inflation Reduction Act (IRA), making them eligible for the full tax credit without the strict requirements applied to purchases.
- Tax Credit Claim: The tax credit technically belongs to the leasing company (the lessor), not the person leasing the EV (the lessee).
- Passing Savings to Consumers: The leasing company might pass the tax credit savings on to you in the form of a rebate or reduced lease payments. However, this is dependent on the dealer or manufacturer agreeing to do so.
In summary, while you cannot directly claim the tax credit when leasing an EV, you might benefit from the credit indirectly if the leasing company passes the savings on to you through discounted lease terms.
Original article by NenPower, If reposted, please credit the source: https://nenpower.com/blog/can-i-claim-the-tax-credit-if-i-lease-an-ev-instead-of-buying-one/
