The Electric Car Tax Credit given to consumers by the IRS could save you up to $7500 when you purchase an electric car. There is a catch, though. Not everyone can enjoy this whopping tax credit this year.
Electric Car Tax Credit
There are a couple of situations where you cannot receive this Electric Car Tax Credit after you buy an electric car. The first situation is if you purchased the car in 2009 or before. The electric cars that will qualify you for the credit are ones purchased in 2010 and later. The second situation is when the manufacturer has sold over 200,000 electric cars in the US. This is when that manufacturer gets phased out of the tax credit. There is one more way to not qualify for the credit and that is if the car is leased and the car lot already took advantage of the tax credit on the car. They do that sometimes to keep lease rates low. Before buying, ask the salesperson to prove that the car qualifies for the tax credit from the IRS.
The tax credit isn’t a full $7500 for buying an electric car. The basic credit is $2500. In addition to that you’ll receive $417 if your car draws battery energy from a battery of 5kW hours or more. You can bump up the credit further for every kW hour after 5 that your car battery has. They’ll give additional $417 for each of those KW hours.
The IRS makes figuring out how much you’ll receive with the Electric Car Tax Credit with a handy chart on their website. Be forewarned, the webpage does take a long time to load sometimes. You can look up the manufacturer and find out how much they’ll give. Tesla, for instance, will generate the full $7500 for all of their car models!
