There are strong incentives on the table right now if you’re in the market for an electric car, a plug-in hybrid, or a fuel-cell EV (lol). The only problem is that in recent months, it’s been difficult to follow which models and trims are eligible for big government tax rebates, and which aren’t. Thankfully, we now have that information in a clear and easily parsable list!
As noted by Sawyer Merritt on Twitter, the IRS has just updated the list of eligible vehicles on FuelEconomy.gov. Using a tool on the site, you can select the range of dates you’re intending to pick up your vehicle, and determine which models will be eligible for a tax credit, and how much. At best, you’re looking at a juicy $7,500 rebate, which is well worth pursuing where available, while some models are eligible for a lesser $3,750 credit.
To be eligible for the rebates, you must be intending to use the vehicle, not resell it. You must also intend to use it primarily in the US, and you have to fall under a certain income level. Meanwhile, for EVs and plug-in hybrids to attract the rebate, they must have a battery capacity of at least 7 kilowatt hours and a gross vehicle weight rating of less than 14,000 pounds. It’s also only applicable to vehicles undergoing final assembly in North America, and those that meet the rules for minimum domestic content levels. You also can’t get a rebate on any vehicle that costs more than $80,000 for vans, sport utility vehicles and pickup trucks, or $55,000 for other vehicles.
Okay, with all that out of the way, what can you get? EV wise, the Cadillac Lyriq and Chevy Bolt are both eligible for the full $7,500, the latter assuming you can still find a 2023 model on a lot somewhere. The Ford F-150 Lightning, Honda Prologue, and Volkswagen ID.4 all get the full rebate too. Meanwhile, the Rivian R1T and R1S attract a lower $3,750 credit due to domestic content rules.
For the Tesla Model X Long Range, you can get a $7,500 credit. For the Model Y, the Performance, AWD, RWD models all score the full amount, too. and For the Model 3, it’s not across the board. Models like the Model 3 Long Range and RWD rely on imported batteries which disqualified them from the tax credit scheme as of January 1 this year. Indeed, none of the refreshed Model 3s qualify, but if you can find a last-gen Model 3 Performance somewhere, that still gets a credit of $7,500.
When it comes to plug-in hybrids, you can get a Chrysler Pacifica PHEV and score the full $7,500 credit. Alternatively, the Audi Q5, Ford Escape, Jeep Grand Cherokee, Jeep Wrangler, and Lincoln Corsair all come with a lower $3,750 rebate. If you don’t know what a Lincoln Corsair is, don’t feel bad. I’d never heard of it either and I’ve been in this industry for years. It’s about as memorable as the album tracks on To The Extreme.
Basically, if you want to get the best deal possible on a new EV or PHEV, these vehicles all have an edge over the competition. Have a look at the list, see if anything catches your eye, and maybe, just maybe, score yourself a new ride.
Image credits: Ford, Honda
$80k/55k rule is such a disgrace. “We’re happy to subsidize luxury as long as you make sure it’s TALL luxury!”
I just went through the process of leasing an EV and ended up with a Ioniq 6 – the leasing loophole basically makes any EV/PHEV eligible (as long as the OEM plays ball). Just lease and immediately buy it out if you’re interested in an Ioniq, or a Prius Prime, or whatever that doesn’t “qualify”.
I sort of knew that going in, but it became a lot more apparent once I dug in…and it seems to be way under-covered by the media.
Yeah, the leasing loophole is the way to go, since it opens up most brands to you. I don’t know any that aren’t passing along the savings (though there are likely some), but I have run across dealers that didn’t know (or are hoping they can get that money, maybe).
Just did exactly this with a Volvo and went with the dealer that was the farthest away in my search radius because they were the only ones to even mention the lease loophole, no idea why the others didn’t mention it. I do have very mixed feelings about the loophole itself but hypocritically took advantage of it anyway.
Well now, that IS interesting….
The headline implies that there will be some sort of list. I see no list. Do I need to read? Can we bold the embedded list?
I’m replying to this solely to let David know that I got the reference.
! 🙂
Whereas I actually didn’t. I had to google it. 😀
I still find the structure of these funny. Buying a $79k EV pick up? Here’s $7,500. Buying $29k (non-plug-in) hybrid? YOU GET NOTHING! WHY DO YOU HATE THE EARTH!?!?!?!
Side question: I am seeing loads of Rivians and Audi RS6 Avants for sale used? What is the deal. I’m especially curious about living with a Rivian since it seems people are choosing to NOT live with owning them. Also, can’t really check them out before purchase, so that might be why people are ditching them?
Probably just dirtbag flippers. I’ve seen it with Toyotas that are in high demand. Car still has the plastic on the seats and is for sale by owner for over MSRP.
https://www.theautopian.com/heres-why-that-rivian-r1t-repair-cost-42000-after-just-a-minor-fender-bender/
This pretty much ended my interest in them….cant imagine insurance ever being remotely affordable on them…
https://insideevs.com/news/690540/rivian-r1t-fender-bender-41k-quote-repaired-fraction/
There are ways around that, though it’s pretty concerning that the high quote was on the table.
Check this out…The other manufacturers aren’t any better…
https://www.reddit.com/r/Audi/comments/1b6qpom/insurance_estimated_this_damage_at_23k/
An important thing to note is the *used* EV credit of $4000! This makes the recalled Chevy Bolts currently flooding the market a steal- some can be had for around $13k before the credit, or $9k after. And they’ve got a brand new battery in most cases! That means 8 years of new battery warranty, and the improved range of the 22+ models on all model years. I just picked up a ’22 with 6k miles for $16k after the rebate.
Woah, really? Might have to do that…
Sometimes, the real story is in the comments!
Important caveat: Used credit up to 4k. If you find a 5k EV, it’s not going to be 1k. It’s 30% of the price, up to $4000. And it only applies to vehicles up to 25k, with a model year at least two years before current calendar year.
It’s a good deal, but it’s important to keep the limitations in mind.
Thought that seemed a little too good to be true.
Don’t forget that the credit cannot have been used recently. Check the # of owners and the last sale date. Some cars may be difficult to tell if they are eligible.
Also ONLY from a dealer.
Yes, those are also important limitations, thank you for adding them.
Another important caveat is the AGI limits: $150,000 for families; $112,000 for heads of house hold, and $75,000 for individuals. If it weren’t for these limits, I would have pulled the trigger and bought a used Outlander PHEV. There are several 2022s in my area with less than 60k miles going for about $24k. So, with the tax credit, you can get a PHEV that still has roughly 8 years or 40k miles on the warranty for less than $20k.
Yeah, I forgot how low the income limits are. That is also an important factor.
Also, remember that there are income restrictions, too, and they are tighter than the ones for the new EV credit. Gotta be aware when you go for a used EV if you want the good deal.
And fairly low income thresholds.
Another note is that some states, on top of all of this, have sales tax exemptions on used BEVs and/or PHEVs, up to a certain cap. In my state that can be worth up to an additional $2500.