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Quick Guide to Federal EV Tax Credits – 2024

Sources: Plug In America, Electrek.co, IRS, FuelEconomy.gov

There’s no doubt there’s been plenty of confusion regarding the new tax credits for EVs. We’ve culled a number of sources for the most up to date information, so you can be well informed.

Keep in mind, manufacturers are continually making changes to take advantage of the new rules – or introduce sales incentives that match or beat them – so you’ll want to stay vigilant as you go car shopping.

Here’s the latest from Plug In America:

PURCHASE – Vehicle Requirements:

  • Must be listed on FuelEconomy.gov website
    https://fueleconomy.gov/feg/tax2023.shtml
  • MSRP limit on vehicle price
    – $80,000 for SUVs, Pickup Trucks and Vans
    – $55,000 for all other vehicles
  • Income limits:
    – $300,000 for joint filers
    – $225,000 for head of household
    – $150,000 for single filers
  • Only one taxpayer can claim the tax credit
  • Your tax credit can be signed over to the dealer, lowering the vehicle price. A certified dealer will give you a tax rebate document with your purchase papers.
  • Must be purchased for personal use, not for resale
  • Must be primarily used in the U.S
  • Must be new
  • Seller must report required information (your name, tax ID# and VIN) to you at the time of sale and to the IRS
  • You WILL still be required to file the credit on your taxes, showing you transferred it to the dealer, using the document received at the dealership.

How The Credit Works

  • $3,750 for minerals; $3,750 for battery components
  • Applies to vehicles purchased on April 18, 2023 and onward
  • Based on receipt of the vehicle, not the date you ordered
  • Modified Adjusted Gross Income (MAGI) for 2023 or 2024 can be used
  • Pricing based on MSRP, not extras like destination charges, taxes, fees
  • Prior sales limits do not apply, so brands like Tesla and GM are eligible

Used EVs are eligible too!

The new law also allows up to $4,000 tax credit for a used EVs meeting eligibility requirements.

  • Tax credit can be up to 30% of sales price, up to $4,000
  • Must be listed on website:
    https://fueleconomy.gov/feg/taxused.shtml
  • Vehicle sale price must be $25,000 or less
  • Must be older than two model years (pre-2021)
  • Must be sold by a dealer
  • Income limits
  • – $150,000 for joint filers
    – $112,500 for head of household
    – $75,000 for single filers
    • Your tax credit can be signed over to the dealer, lowering the vehicle price. A certified dealer will give you a tax rebate document with your purchase papers.
    • Purchaser is eligible once every 3 years
    • Must be purchased for personal use, not for resale.
    • Can’t be the original owner of the vehicle.
    • Can’t be claimed as a dependent on someone else’s tax return.
    • Must be primarily used in the U.S.
    • Each vehicle is only eligible for one tax credit
    • Dealer must report required info to you and to the IRS.
    • Businesses, non-profits, and fleets not eligible

The dirty little secret: Leasing!

Due to what is considered a loophole in the new law, virtually any EV can receive the full tax credit if it is leased through a commercial lessee. Many of the vehicles not subject to the purchase tax credit can receive it via this leasing method. A list of current brands and models eligible for the leasing credit are listed on this Electrek article.

Vehicles who do not qualify, such as the Kia EV6, the company is already changing incentives to match or beat the federal credit. But here’s how it stands right now:

  • Must be made by a qualified manufacturer.
  • Must be propelled by an electric motor of at least 7kWh and be able to charge
  • The credit amount is the lower of:
  • – 15% of the sales price for Plug-In Hybrids
    – 30% of the sales price for all electric vehicles
    • Lessee will get the credit; make sure they pass it on to you, and that you receive your IRS document for tax filing!

Commercial EV Credit

With the advent of larger vehicles like the Tesla Semi, the bill also includes incentives for large-scale commercial vehicles users to benefit.

  • Must be made by a qualified manufacturer and be able to charge from an external source of electricity
  • Vehicles under 14,000 lbs: 7kWh motor
  • Vehicles over 14,000 pounds: 15kWh
  • Rebate maximum:
  • – $7,500 under 14,000 lbs
    – $40,000 over 14,000 lbs
  • Must be new
  • Must not be acquired for resale.
  • Only eligible for one tax credit.
  • Must be used for business purposes.
  • Seller must report required information to you and the IRS

I can’t stress it enough: the rules – and manufacturer’s moves to work around these restrictions – may change. So please double-check details before you sign on the dotted line.

List: Nevada Auto Dealers working to slow EV adoption

We hate to post news like this, but its important for our members to know.

Late last year, automotive dealers sent a letter to the Biden Administration, asking them to “put on the brakes” regarding new rules that will spur even greater EV adoption growth. These dealers claim to be speaking for YOU, the customer, when they say we don’t want electric vehicles. (Side note: 2023 was a record year, clocking 1.2 million in EV sales in the US alone.)

Source: https://www.axios.com/2023/11/28/car-dealers-electric-evs-biden

Quite frankly, we consider it ironic, considering the record level of EV sales they enjoyed last year, and it’s time to call them on their hypocrisy. It’s time for us to fight back, and say YES, WE DO want EVs!

We’ve included a list of Nevada dealerships below who were signatories on that letter. As you’re shopping for a new EV or hybrid, we encourage you NOT to patronize these establishments. There are plenty of other choices in Nevada, and we encourage you to use your economic power to send a message.

Audi Henderson
Audi Las Vegas
Audi Reno Tahoe
AutoNation Buick GMC Henderson
AutoNation Buick GMC West Sahara
AutoNation Honda East Las Vegas
AutoNation Nissan Las Vegas
AutoNation Toyota Las Vegas
AutoNation Volkswagen Las Vegas
BMW of Henderson
BMW of Las Vegas
Cadillac of Las Vegas
Capital Ford
Carson City Toyota
Centennial Hyundai of Las Vegas
Centennial Subaru
Centennial Toyota
Corwin Ford Reno
Corwin GMC Buick Cadillac Reno
David Wilson’s Toyota & Scion of Las Vegas
Desert 215 Superstore CJDR
Dolan Chrysler Dodge Jeep Ram
Dolan Dodge Ram FIAT
Dolan Lexus
Dolan Toyota
Findlay Acura
Findlay Cadillac
Findlay Chevrolet
Findlay Honda
Findlay Honda Henderson
Findlay Kia
Findlay Lincoln
Findlay Mazda
Findlay Nissan Henderson
Findlay Toyota
Findlay Volkswagen
Findlay Volvo Cars Las Vegas
Fletcher Jones Imports
Henderson Hyundai Superstore
Honda West
Jaguar Land Rover Las Vegas
Jerry Seiner Buick GMC Las Vegas
Jerry Seiner Mazda
Ken Garff Mesquite Ford RV
Key Acura of Reno
Lamborghini Las Vegas
Land Rover Henderson
Land Rover Reno
Lexus of Henderson
Lexus of Las Vegas
Lithia Chrysler Jeep of Reno
Lithia Volkswagen of Reno
Mercedes-Benz of Henderson
Mercedes-Benz of Reno
MINI of Las Vegas
Reno Mitsubishi
Subaru of Las Vegas
Tom Dolan’s Reno Kia
Tom Dolan’s Reno Mazda
List: Nevada Auto Dealer signatories to the EV Voice of the Customer Letter.
Source: EV Voice of the Customer

Again, we encourage you to seek out other dealerships for your EV needs.

ICE versus EV: How much can you save?

Thinking about an EV, but not sure of the savings? How about an easy way to calculate and compare?

A big thanks to ChooseEV for this handy page, so you can compare how much you could save by switching to an electric vehicle.

You can type specifically which model you have now, and compare to the model you’re considering. What a handy tool!

ChooseEV – Savings Calculator

ChooseEV Savings Calculator

Great Questions about Electric Vehicles: Part 4

We had a local resident email us with some AMAZING questions about electric vehicles. They were so good, we decided to share them with you on our web page. This is Part 4, talking about vehicle costs, and charging with solar power.
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Q: Will electric cars ever be affordable for those on fixed income?

While EVs tend to be more expensive at purchase, there are a few factors that help make that initial purchase less painful. The main one is something called “total cost of ownership.” That means while EVs tend to cost more when you purchase them, the money you save from reduced maintenance and fuel costs more than make up for the initial expense.  Imagine no oil changes, no radiator flushes, no belts and timing chains to replace, and far less wear to your brakes.

The second one has to do with federal incentives available starting in 2023.  There is a program for tax incentives for new AND used EVs as part of the IRA infrastructure bill that tries to offset some of that initial expense of going electric. For new EVs that qualify, you can receive up to a $7,500 tax credit; used EVs that qualify can receive up to a $4,000 credit. But what if you don’t owe that much in taxes?  Here’s a little secret: if you lease ANY new electric vehicle, you can get $7,500 off the initial price! 

The third idea: consider a used electric vehicle. Due to the fact that many EV enthusiasts lease an EV for three years, in order to get the newest and latest technology, that means a large number of used EVs in great shape are available every year. And as we mentioned in the previous post, even used EVs can qualify for a tax credit – as long as they fall within the parameters, like being more than two years old, and less than $25,000 sale price.

Q: What should one know before assuming they can charge their EV with a solar panel? How many solar panels are needed for one EV? How long does charging take with solar panels?

While many EV drivers use solar panels, it’s not exactly a cut-and-dried solution. Typically, these two things are done separately – solar panels to power your home, and an EV that is powered from the grid.  A solar system that also uses batteries can be used to charge the vehicle, directly but these will vary widely, depending on the company and your local utility’s energy program.

Most people who install solar do it primarily to handle the home’s energy needs, which will also “help” charge the car. Again, a battery system can be used for this, but everyone’s situation is different. If you want a system to power your entire home, as well as your vehicle, it will determine how many panels your home would need.

Another alternative is to use what’s known as community energy. Companies like Arcadia Power allow you to sign up, link to your utility, and use wind or solar energy to power your entire home. It requires no installation or complicated home electrical wiring. Arcadia claims renewable credits on your behalf, and you can truly say your home AND car are 100 percent powered by renewables.

Q: What if the sun isn’t shining? What if power goes out during charging, will it harm the battery in any way? Will it automatically restart charging when the power comes back on?

No harm will come to the EV’s battery if the power goes out – happens at my home more than I care to admit, due to local utility outages. It’s literally just like your cell phone – charging will typically resume as soon as the power comes back on.  However, if your home had some kind of battery storage, the charge may not be interrupted at all. It would depend on what type of system you install on your home.

And if you do decide to install solar on your home, we cannot stress this enough: hire a reputable, licensed contractor. Ask for references, and talk to other clients. Here in Las Vegas, we like to recommend Robco Electric. Their company has done countless solar AND electric vehicle charging installations, and they’re good friends of NVEVA. Ask for Krystal, and tell her the NVEVA sent you!

NOTE: NVEVA does NOT use affiliate links at this time.

Great Questions about Electric Vehicles: Part 3

We had a local resident email us with some AMAZING questions about electric vehicles. They were so good, we decided to share them with you on our web page. This is Part 3, talking about end of battery life.
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Q: What happens when the battery can no longer be charged? Is there fair warning in advance, or does one end up surprised and stranded with a dead vehicle — and what options does one have to fix or replace it? 

If you’ve owned anything else, like a cell phone, you know batteries lose their charge.  And just like your cell phone, the battery doesn’t die immediately.  Typically, you will observe a slow decline in how many hours the phone will work until you need to charge it again.  Same goes for EVs – in fact, the current battery technology is the same as your cell phone. So you would start to notice you don’t seem to get as many miles per charge as you used to.  In the case of EVs with battery degradation, the issue is observed over months or even years.  So it definitely doesn’t happen “on the spot.”

Repair options will depend a lot on the brand of vehicle – frankly, some do better than others in the service department. This is where certain brands get higher ratings than others.  We would always recommend to do your homework – check with other owners, check publications like Consumer Reports, etc. – before making a purchase.

Of course, all of this is dependent on if you even need to replace the battery at all. A recent long-term study shows that Tesla Model S and X batteries have only degraded about 12 percent on average after 200k miles. Here’s the link.

Q: I’ve heard when the battery dies you basically end up paying nearly the same as for a new vehicle. How is that ever going to be affordable on a modest, or a fixed income?

In the earliest days of current electric vehicles (circa 2005), the batteries could be incredibly expensive.  However, these costs have lowered due to economies of scale (basically, the more you make, the cheaper each one becomes to make). And in those earlier days, the batteries suffered from greater reliability issues.  However, now that EVs have become more mainstream, and more companies are making them, the costs have continued to go down.  Now, it is typical if your battery did have to be replaced it would fall under the vehicle warranty.  If it exceeded those miles, the current estimate would be to cost about the same as a new engine in an ICE car.

As electric vehicles become more mainstream, costs of production will continue to fall.  The EV incentives portion of the IRA bill is designed to offset the difference between an EV and a comparable gas car.  The incentives are also designed to go away after a few years, as it’s expected EVs and gas cars will be roughly the same price by then.  So if you need to watch your pennies (as I do), your best options will probably be either: 1) leasing a new EV, or 2) purchasing a used EV that qualifies for the $4,000 credit.

These rules can and will change over time, so it’s best to check the IRS website for the official vehicle lists and qualifications to get the credit. And don’t forget: leasing instead of buying may work better for your situation.  Be sure to check with your accountant or tax advisor to see what works best for you.

In our next post, we’ll talk about charging with solar.

Great Questions about Electric Vehicles: Part 2

We had a local resident email us with some AMAZING questions about electric vehicles. They were so good, we decided to share them with you on our web page. This is Part 2, talking about battery life, and used EVs.
———————–

Q: How long should one expect an EV battery to last? I’ve heard 15-20 years, but how much life can one really expect if the vehicle is kept in an extreme climate?

Every new all electric vehicle in the US comes with a 100,000 mile warranty on the main battery – some are even more. And typically battery life is based on miles, not years.  While the technology is still advancing, the current accepted standard for an EV battery is somewhere over 200,000 miles – some claim much higher.

While heat can definitely be an issue, most EVs made today have a liquid temperature management system – basically a radiator for your battery, which keeps its temperature cooler in summer, and warm in winter. 

If the battery temperature is moderated properly, there’s no reason to think the battery can last hundreds of thousands of miles. Liquid temperature management helps a lot. For cars without a liquid system, things like parking in a garage or covered parking may help the long-term life of the battery.

Q: Is it ever worthwhile to purchase a used EV? How does one evaluate the remaining life of the battery? Does the mileage matter? Does one need to know where the vehicle came from (extreme climate, rental agency, etc)?

Buying a used vehicle – gas or electric – requires the same type of homework, with just a few more steps.  Like any car, you’ll want to check for any remaining warranty available, damage or repair report (like a CarFax), and the like. 

For an EV, it’s best to ask for what’s called a State of Health report.  This can tell you if the battery has suffered any degradation over time, and is typically expressed in percentage of new (i.e., 92 percent). A reputable dealer will be able to get that report for you. 

And don’t forget – there may be tax advantages to getting an EV – new or used – if the vehicle you choose makes the qualifications (See our blog on Tax Incentives for details.)

Next: let’s talk end of battery life

Great Questions about Electric Vehicles: Part 1

We had a local resident email us with some AMAZING questions about electric vehicles. They were so good, we decided to share them with you on our web page. So here goes:

Q: What does it cost to charge an EV at home? 

The two main factors for charging cost are the rate for electricity, and the size of the battery. According to their website, NV Energy charges $0.16 per kwh.  Now let’s say your car’s battery holds 60 kwh.  The cost of charging from 0-100 percent should be about $9.60.  However, most of the time, you wouldn’t let the battery get down to zero – not a good idea for several reasons.  So your average charge will be much less.

Q: Is it safe to charge an electric car in a closed garage?

The answer is definitely yes!  In fact, most drivers charge at home something like 90 percent of the time.  EV charging causes no fumes to be emitted – unlike fueling up with gas or diesel – so there’s no danger of vapor catching fire in your garage.

But I’m sure you’ve heard the stories about electric vehicles catching fire. That sells a lot of newspapers!  However, the facts are much different.  A recent insurance liability study showed that regular gas and diesel vehicles catch fire at a rate 60 to 100 times more often than EVs! So in a way, EVs are actually safer to keep in your garage!

Q: What does it cost to charge an EV at a charging station?

Before we go there, let’s do a very brief explanation about EV charging.  Basically there’s three levels.  Level 1 is plugging into a normal outlet at your home, at 120 volts.  Level 2 is the equivalent of plugging into an electric dryer outlet, at 240 volts.  Level 3 charging (also called DC Fast Charging) is what you find at gas stations and EV fueling stations like a Tesla Supercharger.  They are MUCH more power – 440 volts and above.

Level 1 is the slowest, and can take many hours to charge fully.  Level 2 is 4-10 times as fast, and can charge the car in a few hours.  Level 3 will typically charge a car within a few minutes.

If you do need to use a charging station outside your home, the price may vary widely, especially depending on if it’s Level 2 or 3.  First off, many shopping malls and stores don’t charge at all. It’s often a free service for their customers – but not everywhere, and that could change at any time. Chargers at gas stations and EV stations are typically Level 3, and these will always be a paid service.  Rates can vary widely, but are still significantly cheaper than buying gasoline or diesel.

Some brands like Tesla have software to show you where charging stations are located, and how much they cost.  Others use software like PlugShare to locate stations when needed. Your experience will vary, depending on how much you drive, where you drive, and what brand of vehicle you purchase.

Next: Battery life, and used EVs

Tesla charging – The New Standard?

When does Tesla NOT make a splash? Elon Musk’s ability to continually remain top-of-mind, whether it’s for his personal exploits or his companies, often comes across as more of an ongoing publicity stunt than real substance. But this is one of those times where the news has some real impact for us.

In the last few weeks, several of the major auto brands have jumped on the bandwagon to adopt Tesla’s NACS connector on their upcoming electric vehicles. To date, Ford, GM, Rivian, Polestar, and possibly VW have made moves to Tesla’s port. So what’s the impact?

The adoption of the NACS charge port has the potential to open up most or all of Tesla’s massive Supercharger network to non-Tesla vehicles. This has two distinct advantages for the would-be EV buyer:

  1. With more than 40,000 charging locations – including Superchargers and destination chargers – Tesla easily has the largest network for charging in North America.
  2. The reliability of Superchargers is dominant. According to JD Power, over 1 in 5 EV drivers cannot charge at a non-Tesla charging station; for Tesla, that number is as low as 4 percent.

And that doesn’t even count the fact that the NACS standard has a specification that is approved for up to 500 kWh!

Between the pervasive existence of Tesla chargers, and their overall higher reliability, this is a win-win for EV drivers everywhere.

Read the details here:

https://www.theverge.com/2023/7/5/23784541/vw-toyota-tesla-nacs-ev-charging-plug-standard

Get 100 percent wind power for your entire home!

We know if you’re into electric vehicles, chances are you have thought about cleaner ways of living. One easy way we’ve found is through a great service called Arcadia Power.

They partner with wind and solar farms around the US to make it easy and affordable to power your home with renewable energy. It means no solar panels or turbines, no messy installation – it’s as easy as just signing up.

How it works

Sign up with Arcadia Power, and give them access to your electric utility account. That’s it! Arcadia integrates with your existing utility to make sure your electricity comes from one of their wind or solar farms.  

Join now and your home (and EV) can be powered by 100 percent wind power. It’s free for 30 days, and only $5 a month after that. Use the code paul93940 for possible credits to your account.

Arcadia Power

https://www.arcadia.com/

EV Road Trip Nationwide tour makes stop in Vegas

We had the opportunity to meet up with Daphne and Alyssa from the Connecticut Clean Cars group, a few days into their nationwide EV Road trip. Their trip began on June 1 in San Francisco, and they will be on the road until the end of June.

We all got a chance to connect with Nicole Wargo, from the Clark County Office of Environment and Sustainability, to talk about electric vehicle advocacy for the city, and ways to work together.

From L to R: Alyssa from EV Road Trip; Paul Bordenkircher, Jim Katzen, Paul Scott and Lloyd Reece, Las Vegas EVA; Nicole Wargo, Clark County; Daphne, EV Road Trip.

We spoke for a while about their trip, and where they were headed next. A text that evening said they made it all the way to Bryce Canyon in Utah. They had concerns about the 3,000 foot elevation change and less than comfortable number of chargers on the way. But it turned out their Hertz-rented Chevy Bolt made it with plenty of juice to spare.

We wish Daphne and Alyssa the best of luck with their trip!

If you want to keep up with their journey, check out their website at EVRoadTrip.org

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