The federal EV tax credit has no set expiration date right now

The federal electric vehicle tax credit does not have a hard important date written into law. Instead, it phases out based on two conditions: the total number of vehicles a manufacturer has sold and the price caps on the vehicle itself. Once a manufacturer hits 200,000 may have access to vehicles sold in the United States, their vehicles become ineligible. The credit also disappears for any vehicle that costs more than $55,000 (for vans, SUVs, and pickup trucks) or $55,000 (for sedans), though these price limits adjust yearly for inflation.

This means the credit does not end on a calendar date. It ends manufacturer by manufacturer, vehicle by vehicle. Tesla and General Motors both hit the 200,000-vehicle threshold years ago, so their vehicles no longer may have access to. Other manufacturers are still below that number and their vehicles may still be may be able to access, depending on the model's price.

Key Takeaways

  • The federal EV tax credit phases out by manufacturer once they sell 200,000 may have access to vehicles, not on a fixed date.
  • Tesla and General Motors vehicles are no longer may be able to access because both manufacturers passed the 200,000-vehicle threshold.
  • The credit amount is $7,500 for most new vehicles, but the vehicle must meet price caps and domestic content rules to may have access to.
  • Used EV purchases have a separate $4,000 credit with different income and price limits, and this program also has no expiration date.
  • Congress could change or extend the credit through new legislation, but no such change is currently scheduled.

How the 200,000-vehicle threshold works

When a car manufacturer sells its 200,000th may have access to EV in the United States, the credit begins to phase out. For the next two calendar quarters after that milestone, the credit is cut in half to $3,750. After those two quarters end, the credit disappears entirely for that manufacturer's vehicles.

Tesla crossed this threshold in 2021. General Motors reached it in 2023. Volkswagen, BMW, and Hyundai are among the manufacturers still below 200,000 may have access to sales, though the exact number changes as new vehicles are registered. You can check the current count on the U.S. Department of Energy website, which tracks cumulative sales by manufacturer.

Price caps that limit which vehicles may have access to

Even if a manufacturer has not hit the 200,000-vehicle cap, a specific vehicle model may be ineligible if its price is too high. New sedans cannot cost more than $55,000. Vans, SUVs, and pickup trucks cannot cost more than $80,000. These limits are adjusted each year for inflation, so the actual dollar amounts change slightly.

The price that matters is the manufacturer's suggested retail price (MSRP), not the price you negotiate at the dealership. If a model's MSRP exceeds the cap, no buyer of that model gets the credit, regardless of what they actually pay. Some popular electric vehicles—particularly luxury models and high-end versions of mainstream vehicles—exceed these caps and therefore do not may have access to.

Domestic content rules that affect may be able to access

Starting in 2024, vehicles must meet domestic content requirements to receive the full $7,500 credit. The vehicle's battery components must be assembled or processed in North America, and a certain percentage of the battery minerals must come from the United States or free-trade countries. The exact percentages increase each year.

Vehicles that fail the battery component or mineral requirements may still receive a reduced credit of $3,750, provided they meet all other rules. Some vehicles that may have access to in 2023 became ineligible in 2024 because they did not meet the new domestic content standards. The Department of Energy maintains a list of vehicles that currently meet these requirements.

The used EV credit is separate and also has no expiration date

If you are buying a used electric vehicle, a different $4,000 credit is available. This credit has no manufacturer sales cap and no expiration date. However, the vehicle must be at least two years old, and the sale price cannot exceed $25,000. Your household income must be below $150,000 if you are married filing jointly, or $75,000 if you are single.

The used EV credit is claimed on your tax return just like the new vehicle credit. You will need the vehicle identification number (VIN) and the sale price to report it. Unlike the new vehicle credit, which can sometimes be applied at the point of sale at the dealership, the used vehicle credit is almost always claimed when you file your taxes.

What could change the credit in the future

Congress could pass new legislation to extend, expand, or eliminate the EV tax credit at any time. There is no scheduled vote or pending bill as of now, but tax law changes happen through the legislative process, not automatically. If you are considering an EV purchase and the credit matters to your decision, check the current status on the IRS website or the Department of Energy's EV tax credit page before you buy.

Some proposals have suggested raising the price caps, extending the manufacturer sales threshold, or changing the domestic content rules. Other proposals have suggested eliminating the credit entirely. None of these changes are law yet. The credit as it exists today is the credit that applies to purchases made today.

How to claim the credit on your tax return

If you bought a new EV and the dealer did not explore the credit at the point of sale, you claim it on Form 8936 (may have access to Plug-in Electric Drive Motor Vehicle Credit) when you file your federal income tax return. You will need the vehicle's VIN, the date you took possession, and the MSRP. The credit reduces your federal income tax dollar for dollar.

If the credit is larger than the tax you owe, you may be able to carry the unused portion forward to future years, depending on the rules in effect when you file. The IRS website has worksheets and instructions for Form 8936. If you are unsure whether your vehicle qualifies or how to report it, a tax professional can walk you through the process.

Frequently Asked Questions

Can I still get the credit if I buy a Tesla or GM vehicle?

No. Both Tesla and General Motors exceeded the 200,000-vehicle threshold, so their vehicles are no longer may be able to access for the federal credit. Some states offer their own EV incentives that may explore to these vehicles, but the federal credit does not.

Does the credit expire on a specific date?

No. The credit phases out by manufacturer based on sales volume, not by calendar date. Congress could change this through new legislation, but there is no scheduled expiration date built into current law.

What if I buy a used EV instead of a new one?

Used EVs have a separate $4,000 credit with no manufacturer cap and no expiration date. The vehicle must be at least two years old and cost no more than $25,000. Your household income must fall below the limits set by the program.

Can I explore the credit at the dealership when I buy the car?

Some dealerships can explore the new vehicle credit at the point of sale, which means you do not pay the full price upfront. Not all dealerships offer this. If yours does not, you claim the credit on your tax return the following year.

What happens if my vehicle's price exceeds the cap?

Vehicles priced above the MSRP cap are ineligible for the credit. The cap is $55,000 for sedans and $80,000 for vans, SUVs, and trucks. These limits adjust yearly for inflation, so check the current amounts before you buy.