What Is the EV Tax Credit and Who Qualifies?

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Note: The federal electric vehicle (EV) tax credit ended Sept. 30, 2025. If you purchased an eligible EV on or before that date and you meet the qualifying criteria, you can still claim the credit when filing your 2025 taxes in 2026. 

If you bought an electric vehicle in 2025, you may be eligible for a tax credit worth up to $7,500 for new EVs or $4,000 for used ones. Understanding if you’ve qualified, which vehicles are eligible and how to claim them could mean thousands of dollars back.

EV Tax Credit: At a Glance

• You can get up to a $7,500 credit for qualifying new EVs purchased before Sept. 30, 2025. 
• You can get up to a $4,000 credit for qualifying used EVs purchased before Sept. 30, 2025.
• There are income limits that affect credit eligibility.
• You can either claim the credit on your 2025 tax return or transfer the credit to the dealership at the time of sale to get an immediate discount.
• The credit is not refundable, meaning you can only get credit up to your tax liability — you won’t get an actual tax refund. 

New vs. Used EV Credit

There are important differences between the new and used EV credit, including the credit value, income limits, vehicle price caps and more. 

Who Qualifies for the EV Tax Credit

To claim the EV tax credit, you need to meet requirements in three different categories. Note that there are differences in qualifying criteria between new and used vehicles, so you can use the chart above to help determine the specifics.

Buyer Eligibility

• Your modified AGI is below the threshold for your filing status — so your tax bracket matters. 
• You purchased the vehicle primarily for personal use and not for resale.
• Your tax liability is high enough to use a nonrefundable tax credit. This means you can’t get more credits than the taxes you owe. 
• For used EVs, you can’t have claimed a used EV credit in the previous three years. 

Vehicle Eligibility

• Battery capacity of at least 7 kilowatt hours
• Gross vehicle weight rating under 14,000 pounds
• Final assembly in North America
• VIN registered with the Internal Revenue Service (IRS) by the dealer
• For new EVs, the vehicle met critical mineral and battery component sourcing requirements.
• For used EVs, the model year is at least two years older than the purchase year, and not previously transferred after Aug. 16, 2022, to a qualified buyer. 

Purchase Eligibility

• The vehicle was purchased from a dealer registered with the IRS.
• The vehicle was acquired on or before Sept. 30, 2025.
• The dealer provided you with a time-of-sale report.
• The seller reported the sale to the IRS.  

Examples of EVs That May Qualify

The following vehicles qualified for the full $7,500 credit if purchased before the Sept. 30, 2025, deadline. That said, eligibility can vary based on trim level, model year and when the vehicle was placed in service. It’s also important to check against the vehicle’s price cap. 

As a note, this list is not exhaustive, so you can check other vehicles against the eligibility criteria, too:

To check specific models, you can use the Department of Energy’s VIN look-up tool. 

The Two Ways To Claim the Credit

Here’s a breakdown of the two ways you can claim the EV tax credit.

Option A: Claim on Your Tax Return

You can claim the credit when filing taxes using Form 8936. Here’s how: 

1. Obtain the time-of-sale report from your dealer when you take possession of the vehicle.
2. Gather your vehicle’s VIN and purchase documentation.
3. File Form 8936 with your federal tax return. 
4. The credit will reduce your tax liability dollar-for-dollar. 

If you didn’t arrange for transfer at purchase, this is the option you need. It allows you to reduce your taxable burden, but on the downside, it only reduces your burden and can’t be used to generate a return.

Imagine you owe $5,000 in taxes. You qualify for a $7,500 credit. You’ll “lose” $2,500 in value, because you can only use $5,000 to cover your tax burden.

Option B: Take It at the Dealership

When you purchase the EV, you have the option to transfer the credit to the dealer at purchase. This gives you an immediate price reduction, and the dealer later claims the credit on their own taxes.

Here’s how:

1. Verify the dealer is registered with the IRS for credit transfers.
2. Complete the transfer paperwork at the time of sale.
3. The dealer submits the information to the IRS immediately.
4. You receive the credit immediately as a down payment, price reduction, or cash back.
5. You still need to file Form 8936 to report the transfer when filing taxes. 

The pro here is clear: You get an immediate financial benefit and don’t have to wait for a tax refund. And for those who may not have high tax liability for the credit to offset, this also may increase the value you get out of the tax credit. 

Common Reasons People Don’t Get the Credit

If you purchased an EV, you might not qualify for the credit if:

• Your income exceeded the IRS limits. Keep in mind, the IRS uses your income from either the delivery year or the prior year, whichever is lower.
• The vehicle cost too much, exceeding price caps. 
• The dealer wasn’t registered with the IRS. 
• The used EV was too new, as they must be at least two model years older.
• The vehicle didn’t meet the battery sourcing requirements.
• There was no time-of-sale report, which is required documentation for claiming the credit.
• You already claimed the used EV credit within the past three years and are trying to purchase another used EV. 

What “Acquired” and “Placed in Service” Mean

• Acquired: This is when you enter into a binding written contract and make a payment — such as a down payment, trade-in or deposit. This is the date that determines if you beat the Sept. 30, 2025, deadline.
• Placed in service: This date is when you took possession of the vehicle and drove it off the lot.

According to IRS guidance, if you acquired the vehicle on or before Sept. 30, 2025 — even with just a small down payment — you can still claim the credit even if you took delivery after that date. However, you must file Form 8936 in the year the vehicle was placed in service. 

State and Local EV Incentives

While the federal EV tax credit has ended, many states continue offering their own incentives for vehicles purchased. Some examples include: 

• Maine: Rebates up to $7,500 for low-income customers
• Illinois: IEPA rebates up to $4,000 through June 30, 2026
• New Mexico: Up to $3,000 tax credits
• New York: Rebates up to $2,000

Key Takeaways

• The federal EV tax credit ended Sept. 30, 2025, but you can still claim it if you acquired an eligible vehicle before that date.
• New EVs can receive up to $7,500, and used EVs can receive up to $4,000.
• Income limits, price gaps and battery sourcing requirements can restrict credit eligibility.
• Credits can be claimed on your tax return or could have been transferred to the dealer at purchase.
• The credit is nonrefundable, so account for your tax burden after tax deductions to assess the potential value of the credit.
• Some states offer their own EV incentives, which have not ended with the federal tax credit. 
• Keep your time-of-sale report and purchase documentation for filing. 

Caitlyn Moorhead, Jacob Wade and Elizabeth Constantineau contributed to the reporting for this article.

Data is accurate as of Jan. 12, 2026, and is subject to change.

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