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2024 EV Incentive Guide

The team at YellowTin is always looking for information to share with you to reduce your emissions and take advantage of savings opportunities, which is why we want to introduce to you some changes for Electric Vehicle incentives in 2024. These new rules and tax credits from the Inflation Reduction Act (IRA) could be the push you need to make the jump to greener transportation. Take a look at some of this new info:

  • Point-of-Sale EV Tax Credits
  • Tax Credits for Used EVs
  • Leased EV Tax Credits
  • What else to know:
    • Fewer Eligible EVs
    • Income Requirements
Point-of-Sale EV Tax Credits

There is no longer a need to wait until your tax return to receive your federal tax credit for purchasing an EV! Now, buyers can transfer the tax credit of a new or used EV to the dealership for a discounted MSRP.

This new approach not only creates lower vehicle cost, which is great for those financing, but it also means that qualified buyers will receive the full tax credit amount regardless of their tax liability. It’s important to make sure that the dealership meets the proper requirements by being registered on the IRS platform to receive the point-of-sale credit, and be aware that many EVs do not qualify for this credit because of the battery and manufacturing requirements set up by the IRA.

Tax Credits for Used EVs

For those thinking about a used EV, the IRA has created a $4,000 incentive to make EV ownership more accessible to a wider population. This tax credit cannot be more than 30% of the vehicle’s cost, and to qualify the car must be at least 2 years old and under $25,000.

This incentive can be accessed either at a dealership or as a tax credit, but qualified buyers are determined based on income requirements.

Leased EV Tax Credits

This gets a little messy, but the IRA classifies leased EVs as commercial vehicles, which means that a lot of the requirements for the point-of-sale EVs are out the window and a lot more vehicle models have qualified eligibility. Leasing is making EVs an incredibly affordable option and is great for people wanting to ease into the transition of electric vehicles.

The credit for leasing is capped at $7,500, but dealerships aren’t required to pass on the entire amount so make sure you have a clear understanding of expectations when considering this exciting option.

What else to know:

Fewer Eligible EVs: The IRA introduced increased battery sourcing and manufacturing requirements for EVs, meaning that fewer vehicles qualify for the point-of-sale purchase. There are currently 29 models that qualify for a federal tax credit, but expect that list to grow throughout the year.

Income Requirements: Income requirements have stayed the same as the previous year, but it’s important to understand how you qualify while considering these options.

New EVs

  • $300,000 for married couples filing jointly
  • $225,000 for heads of households
  • $150,000 for all other filers
 

Used EVs

  • $150,000 for married couples filing jointly
  • $112,500 for heads of households
  • $75,000 for all other filers
 

This is a good start for all the information you need to know about purchasing or leasing an EV in 2024. If you would like to understand how much money an EV could save you in energy costs, log on the platform and head to the transportation section to do some calculations yourself. If you have any questions, please reach out to the YellowTin Energy Experts. We hope this information was helpful and wish you the best on your journey towards clean energy!