Last updated March 2026
EV Tax Credits & Incentives 2026
The US federal government offers up to $7,500 off a new EV and $4,000 off a used EV. Stack that with state rebates and the savings are significant. Here's everything you need to know — plus a calculator to see your exact numbers.
Federal Incentives
$7,500
New EV Tax Credit
- ✓Vehicle MSRP under $55,000 (cars) or $80,000 (SUVs/trucks)
- ✓Buyer income under $150,000 single / $300,000 joint
- ✓Battery components must meet North American sourcing rules
- ✓Can be applied as a point-of-sale discount at the dealership
Applies to new battery electric and plug-in hybrid vehicles.
$4,000
Used EV Tax Credit
- ✓Vehicle sale price at or under $25,000
- ✓Buyer income under $75,000 single / $150,000 joint
- ✓Vehicle must be at least 2 model years old
- ✓Can only be claimed once per vehicle
A newer credit that makes second-hand EVs far more accessible.
Up to $7,500
Commercial EV Credit
- ✓Vehicles used for business purposes
- ✓No income cap for businesses
- ✓Covers light-duty and some commercial vehicles
- ✓Leased vehicles may qualify via the leasing company
Businesses and fleet operators can claim this via Form 8936.
State Incentives
Many states offer rebates or tax credits on top of the federal credit. The examples below are representative — check your state's energy office for the exact current amounts.
| State | Benefit | Type |
|---|---|---|
| California | Up to $7,500 rebate (CVRP) | Rebate |
| New York | Up to $2,000 rebate (Drive Clean) | Rebate |
| Colorado | $5,000 state tax credit | Tax Credit |
| Texas | $2,500 rebate (select utilities) | Rebate |
| Massachusetts | $3,500 rebate (MOR-EV) | Rebate |
| Illinois | $4,000 rebate (ILEV) | Rebate |
Source: State energy offices. Always verify current amounts before purchase. Full list at afdc.energy.gov →
Calculate Your Real Savings
Select your incentive, enter your vehicle details, and see the total cost of EV ownership vs a gas car over time.
Step 1 — Choose your incentive
Select the credit you qualify for. It will be deducted from the EV purchase price automatically.
Incentive applied: $7,500 off EV purchase price
Step 2 — Enter your vehicle details
Electric Vehicle
Effective price after incentive: $32,500
Gas Vehicle
Step 3 — Your results
EV Total Cost
$38,050
Purchase (after incentive): $32,500
Energy: $1,800
Maintenance: $3,750
Gas Car Total Cost
$53,375
Purchase: $35,000
Fuel: $9,375
Maintenance: $9,000
Total Savings with EV
$15,325
Save: 28.7% over 5 years including $7,500 incentive
Note: Estimates only. Actual costs vary by location, insurance, depreciation, and incentive eligibility. Confirm your incentive eligibility at fueleconomy.gov.
Common Questions
Can I stack the federal credit with state incentives?
Yes. Federal and state incentives are independent. In states like California or Colorado you can stack both, potentially reducing your purchase price by $10,000–$15,000 or more.
What does 'point of sale' mean?
Since 2024, eligible buyers can transfer their federal tax credit to the dealership and receive it as an immediate discount at purchase, rather than waiting until tax season.
Do leased EVs qualify?
Leased vehicles fall under the commercial credit, which has no income cap. Leasing companies typically pass the savings to you as a lower monthly payment — ask your dealer explicitly.
What if I owe less in taxes than the credit?
The federal EV credit is non-refundable — you can only use it up to the amount you owe in federal taxes that year. The point-of-sale transfer option sidesteps this for most buyers.