State incentives for electric vehicle (EV) leases vary widely and can be quite different from federal incentives in terms of amount, eligibility, and application.
Federal EV Lease Incentives
- The federal government offers a tax credit of up to $7,500 for leasing new qualified battery electric vehicles (BEVs), plug-in hybrid electric vehicles (PHEVs), or fuel cell vehicles.
State EV Lease Incentives
- Colorado: Offers a state tax credit of up to $5,000 for purchasing or leasing qualifying electric or plug-in hybrid vehicles priced up to $80,000, and $2,500 for vehicles up to $35,000 MSRP. Lease agreements must be at least two years. Some dealers allow the tax credit to be applied directly at the point of sale.
- California: The “Clean Cars 4 All” program provides income-eligible residents in select air districts up to $12,000 for replacing older vehicles with cleaner options including EVs, and this program expanded statewide in 2024 under the Driving Clean Assistance Program (DCAP).
- Connecticut: The Connecticut Hydrogen and Electric Automobile Purchase Rebate (CHEAPR) program offers rebates for lease or purchase of new or used EVs with MSRP under $50,000. Standard rebates are up to $1,500 for BEV leases or purchases, with additional income-eligible rebates of up to $4,500 for new and $5,000 for used vehicles starting in 2025.
Comparison Summary
| Aspect | Federal Incentives | State Incentives |
|---|---|---|
| Maximum Credit Amount | Up to $7,500 | Varies: Colorado up to $5,000; California up to $12,000 (income eligible); Connecticut up to $1,500 plus additional rebates for income eligible |
| Eligibility Criteria | Qualified new BEVs, PHEVs, fuel cells | Varies by state, often based on MSRP, residency, income eligibility, and lease duration |
| Application | Tax credit claimed on federal tax return | Tax credits or rebates applied via tax return, point-of-sale discounts, or direct rebates |
| Vehicle Price Limits | Federal limits tied to vehicle qualification | Common in states, e.g., Colorado caps at $80,000 MSRP, Connecticut at $50,000 MSRP |
In summary, state incentives for EV leases can sometimes exceed federal incentives in value, particularly when combined with income-eligible programs or point-of-sale discounts. However, state incentives also tend to have more variability in eligibility, rebate amounts, and vehicle price limits compared to the standard federal tax credit.
Original article by NenPower, If reposted, please credit the source: https://nenpower.com/blog/how-do-state-incentives-for-ev-leases-compare-to-federal-incentives/
