Cars for Zach

Cars for Zach

Plug-In Hybrids (PHEVs)

Electric Vehicles (EVs)

Commodity

Luxury


Additional Resources

Federal Tax Credit for New Electric Vehicles

Link

The federal government offers two separate $3750 tax credits (total of $7500) for the purchase of a new electric vehicle if that vehicle sources critical minerals and materials for its battery components according to certain requirements. The federal tax credit is nonrefundable, meaning if you owe less in taxes than the credit, you will not receive the additional amount as cash.

This tax credit does not apply to leased vehicles. However, there is a separate legislative loophole that allows manufacturers to apply a $7500 lease credit if they choose (which is not subject to the same restrictions as below).

Requirements

  • Must be an EV or PHEV with a battery capacity of at least 7 kWh
  • Vehicle must be made by a qualified manufacturer (check link above for eligibility)
  • Vehicle must not have been previously registered, title, purchased, or used for any purpose
  • Vehicle MSRP requirements:
    • MSRP does not exceed $80000 for vans, SUVs, and pickup trucks
    • MSRP does not exceed $55000 for other vehicles
    • MSRP limits do not include destination fees, dealer add-ons, or other taxes and fees
    • MSRP limits are not affected by manufacture/dealer incentives or trade-ins
  • Vehicle must undergo final assembly in North America, but does not actually need to be sold by an American auto manufacturer (see link above for eligibility); this means that many vehicles from non-American manufacturers are eligible for the credit, such as the Volkswagen ID.4
  • Modified adjusted gross income (AGI) of buyer may not exceed $150000 for a person filing taxes individually

Federal Tax Credit for Used Electric Vehicles

Link

The federal government offers 30% of the sale price (up to $4000 max) in tax credits for the purchase of a used electric vehicle. The federal tax credit is nonrefundable, meaning if you owe less in taxes than the credit, you will not receive the additional amount as cash.

Requirements

  • Must be an EV or PHEV with a battery capacity of at least 7 kWh
  • Vehicle must be made by a qualified manufacturer (check link above for eligibility)
  • Vehicle must be sold used for $25000 or less
  • Vehicle must be purchased from a dealership, not a private party
  • Vehicle model year must be at least 2 years before the current year; e.g. if it is currently the year 2023, the vehicle model year must be 2021 or earlier
  • Modified adjusted gross income (AGI) of buyer may not exceed $75000 for a person filing taxes individually

Colorado Innovative Motor Vehicle Tax Credit

Link

Colorado offers up to $5000 in tax credits for the purchase of a new electric vehicle. The tax credit is refundable, meaning if you owe less in taxes than the refund, you will receive the excess amount.

If the vehicle is leased rather than purchased, the credit will go to the lessee and not the lessor, but the lessee may assign the credit to a financial entity. If a purchaser or lessee assigns the credit to a financial entity, they forfeit the right to claim it on their taxes. The entity may charge a fee for the assignment not exceeding $150 ($250 beginning 1 January 2024). The credit can be assigned through form DR 0618.

Beginning 1 January 2024, an additional credit of $2500 is offered toward any vehicle with an MSRP of $35000 or less, and an additional credit of $600 is offered if the purchaser or lessee assigns the entire allowable credit to a financial entity.

Requirements

  • Vehicle must be new at the time of purchase
    • A dealer demonstration vehicle is considered “new” so long as it has less than 1500 miles
    • A vehicle that has been titled or registered in any state prior to purchase is not considered “new”
  • Vehicle must have a Gross Vehicle Weight Rating (GVWR) of 8500 lbs or less
  • Vehicle must have a battery capacity of at least 4 kWh and be “propelled to a significant extent” by an electric motor
  • If vehicle is leased rather than purchased, the lease must be for at least 2 years
  • Vehicle MSRP must be $80000 or less
    • MSRP limits do not include destination fees, dealer add-ons, or other taxes and fees
    • MSRP limits are not affected by manufacture/dealer incentives or trade-ins