Key Differences Between New and Used Electric Vehicles
- Credit Amount:
- New Electric Vehicles: Eligible for up to $7,500 in tax credits, depending on the vehicle meeting specific battery and sourcing requirements.
- Used Electric Vehicles: Eligible for a tax credit of up to $4,000.
- Eligibility Criteria:
- New Electric Vehicles: Must meet both battery sourcing requirements and critical minerals requirements to be eligible for the full credit. Additionally, vehicles are subject to price caps ($55,000 for cars, $80,000 for SUVs, vans, and trucks).
- Used Electric Vehicles: There are no detailed public requirements about battery sourcing or critical minerals for used vehicles, but they are subject to a model year 2017 or later requirement and must be purchased from a dealer. The seller must provide documentation, and the vehicle must have a purchase price of $25,000 or less.
- Income Limitations:
Both new and used vehicles are subject to the same income limitations: $150,000 for single filers, $225,000 for heads of households, and $300,000 for joint filers. - Claiming the Credit:
Generally, buyers must purchase or lease the vehicle for personal use and report it on their tax return. New vehicles often allow for point-of-sale discounts, which can be applied as down payments.
For detailed instructions on claiming credits, the IRS provides specific guidelines for both new and used vehicles.
Original article by NenPower, If reposted, please credit the source: https://nenpower.com/blog/how-does-the-tax-credit-process-differ-for-new-versus-used-electric-vehicles/
