Critical 2025 EV Tax Credit Calculation Flaw

Forum|Forum|4 months ago
January 24, 2026
2 replies
32 views

I contacted TurboTax support today to inform them about a calculation and logic flaw in the determination of eligibility of the 2025 EV tax credit. I want to ensure that this issue is highlighted for the benefit of the community as I do not have confidence that Intuit or TurboTax will take action to correct this issue in the software after my interaction with the support team.

Pursuant to IRS guidance in FAQ FS-2025-05 section 3 dated 8/21/2025, from IRS announcement IR-2025-86, linked below, the following text is clear about eligibility in a specific circumstance:

3. What effect does “acquisition” of a vehicle have on a taxpayer’s ability to claim a credit under sections 25E, 30D, and 45W?

Acquiring a vehicle prior to the termination date is an initial step, but acquisition alone does not immediately entitle a taxpayer to a credit. Sections 25E(a), 30D(a), and 45W(a) require the vehicle be “placed in service” to claim the respective credit (see IRS.gov for additional requirements). If a taxpayer acquires a vehicle by having a written binding contract in place and a payment made on or before September 30, 2025, then the taxpayer will be entitled to claim the credit when they place the vehicle in service (namely, when they take possession of the vehicle), even if the vehicle is placed in service after September 30, 2025. Taxpayers should receive a time of sale report from the dealer at the time they take possession or within three days of taking possession of the vehicle.

https://www.irs.gov/newsroom/faqs-for-modification-of-sections-25c-25d-25e-30c-30d-45l-45w-and-179d-under-public-law-119-21-139-stat-72-july-4-2025-commonly-known-as-the-one-big-beautiful-bill-obbb

According to this, if a taxpayer enters a "written binding contract" and makes a payment on or before 9/30/2025, that taxpayer is eligible to take the credit even if the vehicle is placed in service after 9/30/2025.

In TurboTax, the user is only permitted to enter two dates, one is the "Sale Date" and the other is the "Placed in Service Date". If a user enters a "Placed in Service Date" after 9/30/2025 and enters a "Sale Date" before the expiration of the tax credit, TurboTax will determine the taxpayer ineligible for the credit and not apply the credit.

The "Sale Date" may be different than the "Written Binding Contract" and "Payment" dates on form 15400. TurboTax can and should honor IRS guidance by allowing the user to enter the "Written Binding Contract" and "Payment" dates reported on form 15400 so that TurboTax can accurately determine taxpayer eligibility for the EV tax credit in 2025 while being consistent and compliant with this clear IRS guidance.

Anyone else see this problem?

user17691990447

Level 4

Yes, I experienced this problem yesterday and posted something similar to your post. If I enter the actual purchase and placed into service dates (9/29/2025 and 10/21/2025), Turbotax says I'm not eligible for the credit. If I change the placed into service date to 9/29/2025, Turbotax calculates the credit correctly.

I'm surprised that Intuit didn't get this right on the first try since the IRS guidance is very clear that eligibility is based on purchase date but seems like it should be an easy fix to correct this in the software. Did they give you any estimate for when this will be corrected?

matt1235Author

Level 3

They did not give me any estimate. I was on the phone for over an hour and frankly they appeared to disregard the issue. The representative bluntly suggested that I should take the issue to the forums.

I was dissatisfied due to the fact that it is very easy to look up this guidance, and at the time the guidance was issued it actually made headline news. I provided the exact same IRS documents to TurboTax/Intuit but they appear to not be taking it seriously. They do not issue a ticket that can be tracked for the issue so there is no follow up mechanism for the consumer. I hope they implement a fix quickly.

Even ChatGPT is able to acknowledge the IRS guidance reference and concludes that the tax credit is applicable if a binding contract with payment happened before 9/30/2025 and the vehicle was placed in service after 9/30/2025.

One interesting nuance is in form 8936 it doesn’t even have a date field, so it appears TurboTax is using internal logic not reported on the form, and their internal logic appears incomplete because it does not account for the IRS guidance.

user17691990447

Level 4

Just out of curiosity, I tried to report this bug through the Turbotax help chat and this is the response I received:

"For the Clean Vehicle Credit in tax year 2025, eligibility is based on the date the vehicle is placed into service, not just the purchase date. The credit applies to vehicles placed into service on or before September 30, 2025. Vehicles purchased before October 1, 2025, but placed into service after that date generally don't qualify.

The credit rules specify that the vehicle must be new and meet other criteria like final assembly in North America and MSRP limits.

In summary, it's the placed into service date that determines credit eligibility, not strictly the purchase date."

This response from Intuit help chat is obviously completely incorrect based on the IRS guidance you referenced in your post as well as the extensive media coverage prior to the deadline confirming that buyers did not need to take possession of the vehicle prior to the deadline to receive the credit.

Do Intuit employees monitor this forum? As you pointed out, this is a significant bug in the software so it would be nice if someone from Intuit could acknowledge the problem and confirm that it will be addressed.

user17696563479

Level 2

Yes, I am also experiencing the same problem. I agree with your assessment, as I went through the IRS publication. Thank you for posting. I hope to see it addressed soon. Following....

matt1235Author

Level 3

I will check if the behavior has changed this weekend in the software.

chatGPT is recommending not using any dates that differ from the form the manufacturer provided. I think this issue makes TurboTax a full brick for users impacted by this issue.

Anyone else seeing their tax credit denied by TurboTax due to this flaw?

user17696563479

Level 2

Yes, the credit is being denied on my end. The binding contract date was 9/24/2026. Once I enter "the date placed in service" of 10/6, it denies/reverses the credit. Only if I enter anything on or before 9/30 for "the date placed in service", it allows the credit; once I put the 10/6 "place in service date", it reverses it. I am entering the exact dates from the Clean Vehicle Seller Report 15400. Date of Sale and Date Place in Service are 10/6, but the Date of Written Binding Contract is 09/24, which, based on the IRS document, the credit should be allowed, assuming all other requirements are met.