turbotax icon
cancel
Showing results for 
Search instead for 
Did you mean: 
turbotax icon
cancel
Showing results for 
Search instead for 
Did you mean: 
Announcements
Close icon
Do you have a TurboTax Online account?

We'll help you get started or pick up where you left off.

RandysF
New Member

EV tax credit

My daughter bought a used EV in 2024 and received a $4000. tax credit.

How log must she own the car before transferring it to another owner ?

 

You already have 3 different answers posted on the Intuit page.........on says 3 years or she must pay back the credit.

One says there is no limitations and no need to pay back the credit.

The other says 30 days.

What is the correct answer.......this is for a used EV and is a second owner tax credit.

 

x
Do you have an Intuit account?

Do you have an Intuit account?

You'll need to sign in or create an account to connect with an expert.

2 Replies

EV tax credit

Go to this IRS website - https://www.irs.gov/credits-deductions/used-clean-vehicle-credit

Who qualifies

  • Not have claimed another used clean vehicle credit in the 3 years before the purchase date 

IRS Form 8936 Clean Vehicle Credits page 3 - https://www.irs.gov/pub/irs-pdf/i8936.pdf#page=3

 

Under Previously Owned Clean Vehicle Certification and Other Requirements

You have not claimed another previously owned clean vehicle credit in the 3 years before the purchase date.

Vanessa A
Employee Tax Expert

EV tax credit

There is not a specific time frame that she must own it to not have to pay back the credit. However, if she bought the car with the intention of selling the car, then she was not eligible for the credit. As one of the criteria to claim the credit is that you must not purchase it with the intention of reselling it, it has to be for personal use.

The 3 years applies to eligibility to claim the credit.  If she claimed the credit in 2024, she would not be eligible for claim it again until after the 3 year mark in 2027. 

In order for her not to have to repay the credit, she simply must still be eligible for the credit.  In order to qualify, one must meet the following criteria:

  • You must NOT be the original owner
  • You must NOT be claimed as a dependent on another persons tax return
  • You must NOT have claimed a used vehicle credit in the past 3 years
  • You must be the person who bought the vehicle for use and not for resale
  • Your AGI cannot be greater than:
    • $150,000 for Married Filing Jointly
    • $112,500 for Head of Household
    • $75,000 for all other filers
      • You can use your AGI from the year you buy the vehicle or the year before if your income would qualify in one year but not the other. 

 

For the vehicle to qualify the following has to be met:

  • At least 2 years older than the current model year
  • Must have a sales prices of no more than $25,000
  • Be used primarily in the US
  • Have a GVWR of less than 14,000lbs
  • Cannot have been used for a used vehicle credit previously
  • Bought from a dealer (cannot be a private sale)
  • The dealer must report certain information to you at the time of the sale

This Credit is Non-Refundable. meaning she must have a tax liability to use the credit against and the credit cannot be carried forward.  The Used EV Credit is worth 30% of the purchase price up to $4,000

 

Click here to see if your make and model qualify.

Be aware, that if she sold the car shortly after purchasing it, it is possibly that she will have to report a gain on the sale as she would have to reduce the basis of the car by the credit she received.  This means if she paid $25,000 for the car and received a $4,000 credit, her basis would be $21,000.  If she then sold the car for $25,000, she would have a $4,000 capital gain that she would need to report on her return. 

(Edited 1/28/2025 @12:29PM PST) @RandysF

**Say "Thanks" by clicking the thumb icon in a post
**Mark the post that answers your question by clicking on "Mark as Best Answer"
message box icon

Get more help

Ask questions and learn more about your taxes and finances.

Post your Question