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aram1
Returning Member

I bought ev in 2021 can I still get 7500$ tax credit if I am married with 2 kids, and what are the income limits?

 
5 Replies
Mike9241
Level 15

I bought ev in 2021 can I still get 7500$ tax credit if I am married with 2 kids, and what are the income limits?

can't tell you every vehicle has a maximum sales allotment. once those many were sold the credit went to zero. the credit is limited by your income tax liability. if your tax liability is $2000 snd you have bought a qualifying vehicle for the $7500 credit all you get is $2000. the rest is lost.

see this link

https://www.edmunds.com/fuel-economy/the-ins-and-outs-of-electric-vehicle-tax-credits.html 

file form 8936 with your return.  did you get confirmation from the dealership that your vehicle qualifies?

 

 

 

Opus 17
Level 15

I bought ev in 2021 can I still get 7500$ tax credit if I am married with 2 kids, and what are the income limits?

Your tax liability is the tax you actually paid, regardless of refund.  For example, if you paid $5000 in withholding and received a $1000 refund, your tax was $4000.   Or, if you had $3000 in withholding and owed $1000 when you filed, your tax liability was still $4000.  

Your EV credit can’t exceed your tax liability, and your other credits count first.  Look at your 2020 tax return and determine your tax liability.  Then remember that the child tax credit will be $1000 higher per child (or $1600 higher if the child is age 5 or less), so your liability will be lower.  That updated tax liability is the largest your EV credit would be if you buy in 2021.  

You could increase your tax liability by changing from pre-tax retirement contributions to after-tax (Roth) or by deferring planned charity donations, or by increasing your taxable income in some other way.  It’s impossible to give comprehensive suggestions, you may want to see a tax planner if you want to buy an EV this year.  

*Answers are correct to the best of my ability at the time of posting but do not constitute legal or tax advice.*
aram1
Returning Member

I bought ev in 2021 can I still get 7500$ tax credit if I am married with 2 kids, and what are the income limits?

Thanks for the answer, so let's say they already withhold 10000$K from my paystubs during the year which is showing in line 25 of Tax forms but I  still own them 1000$, so my tax liability 11000$?

aram1
Returning Member

I bought ev in 2021 can I still get 7500$ tax credit if I am married with 2 kids, and what are the income limits?

thanks for answer

Opus 17
Level 15

I bought ev in 2021 can I still get 7500$ tax credit if I am married with 2 kids, and what are the income limits?

For 2020, your tax liability is on line 24.  If your withholding on line 25 was $10K and you still owed $1000 on line 37, then I would assume your liability was at least $11,000.

 

To assess your possible EV credit for 2021, you would need to know what your line 24 tax liability will be.  Your child tax credit (line 19) will be higher than in 2020.  The EV credit would be reported on line 20.  Your credits on  line 19 and 20 have to be more than your tax on line 16 and 17 in order to use the full EV credit. 

*Answers are correct to the best of my ability at the time of posting but do not constitute legal or tax advice.*

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