Congratulations on the purchase of your new vehicle!
To qualify, you must:
- Buy it for your own use, not for resale
- Use it primarily in the U.S.
In addition, your modified adjusted gross income (AGI) may not exceed:
- $300,000 for married couples filing jointly
- $225,000 for heads of households
- $150,000 for all other filers
You can use your modified AGI from the year you take delivery of the vehicle or the year before, whichever is less. If your modified AGI is below the threshold in 1 of the two years, you can claim the credit.
The credit is nonrefundable, so you can't get back more on the credit than you owe in taxes. You can't apply any excess credit to future tax years.
The $7,500 credit is broken into two new credits
- $3,750 for meeting critical minerals requirement*
- $3,750 for qualifying vehicle meeting battery component requirement*
There are several eligibility requirements, which includes final assembly in North America.
To qualify, a vehicle must:
- Have a battery capacity of at least 7 kilowatt hours
- Have a gross vehicle weight rating of less than 14,000 pounds
- Be made by a qualified manufacturer.
- FCVs do not need to be made by a qualified manufacturer to be eligible. See Rev. Proc. 2022-42 for more detailed guidance.
- Undergo final assembly in North America
- Meet critical mineral and battery component requirements (as of April 18, 2023).
The credit will be reported on Form 8936, which will be part of your tax return. The credit will be reflected on your tax return, Form 1040, line 20.
I hope this information is helpful!
Connie
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