Tax Credit for Used EV
We talked about buying a new EV, but what about used EV? As of January 1, 2023, you could be eligible for a used clean vehicle tax credit. To qualify, an individual must:
- Be an individual who bought the vehicle for use and not for resale
- Not be the original owner
- Not be claimed as a dependent on another person’s tax return
- Not have claimed another used clean vehicle credit in the 3 years before the purchase date
And the vehicle must:
- Be purchased from a licensed dealer
- Have a sale price of $25,000 or less
- Have a model year at least 2 years earlier than the calendar year when you buy it. For example, a vehicle purchased in 2023 would need a model year of 2021 or older.
- Not have already been transferred after August 16, 2022, to a qualified buyer.
- Have a gross vehicle weight rating of less than 14,000 pounds
- Be an eligible FCV or plug-in EV with a battery capacity of least 7 kilowatt hours
- Be for use primarily in the United States
This nonrefundable credit equals 30% of the sale price, with a maximum credit of $4,000, and applies only to purchases made in 2023 or later. Additionally, your modified AGI must fall within specific thresholds. Take advantage if you are in the market for a used EV.