Starting next year, income tax credits from the U.S. government will be available for buyers of new and used electric or plug-in hybrid vehicles at the time of purchase. The Treasury Department says the near-instant credits of $7,500 for an eligible new vehicle and $4,000 for a qualifying used vehicle should lower purchasing costs for consumers and help car dealers by boosting EV sales.

Currently, eligible buyers, including those that bought an EV or hybrid this year, have had to wait until they filed their federal income tax returns to get the benefits. Under the Inflation Reduction Act, buyers will be able to transfer the credits to dealers, so they can be applied at point of sale starting Jan. 1.

New vehicles must qualify under certain guidelines and buyers’ incomes must fall below an adjusted gross annual income of $150,000 if single, $300,000 if filing jointly and $225,000 if head of a household. The vehicles must also be manufactured in North America. Sticker prices on SUVs, vans and trucks must be below $80,000; cars can’t cost more than $55,000, and used EVs can’t cost more than $25,000. There also are requirements for battery and component manufacturing that could disqualify some vehicles or make them eligible for only part of the tax credits.

Source: Wane

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