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February 26, 2024
Question

Why did my ev tax credit get reduced from $7,500 to $4,500?

  • February 26, 2024
  • 1 reply
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1 reply

DawnC
Employee
February 27, 2024

What is the battery size?   If you own either a qualified all-electric or hybrid, plug-in motor vehicle (which can be either a passenger vehicle or a light truck), you may be eligible to receive the Qualified Plug-in Electric Drive Motor Vehicle Credit reported on Form 8936.   The credit ranges from $2,500 to $7,500, depending on battery capacity and manufacturer caps.

 

Qualifying conditions 

An electric vehicle's battery size determines the amount of credit you may receive. Typically, the larger the battery, the larger the credit. For some models, the credit amount can fall well below $7,500.

 

The maximum credit is $7,500.  It is nonrefundable, so you can't get back more on the credit than you owe in taxes. You can't apply any excess credit to future tax years.

 

The amount of the credit will depend on whether the vehicle meets new critical minerals and battery components requirements for vehicles placed in service after April 17, 2023. See the IRS Plug-In Electric Drive Vehicle Credit for more information.

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