January 1, 2023 marked the start of another year for the world, but in the EV space, more specifically U.S. consumer purchases, the date ushered in a fresh start for new tax credits for new and used vehicles. While much dust still settles on the Capitol, it is working to implement new qualification requirements for tax credits, we have some information on which used electric vehicles qualify and which don’t. Here’s what we know so far.
A used electric vehicle could be the way forward in 2023
Although the federal tax credit of $7,500 has been extended for new EV purchases Under the revised qualification conditions, these current requirements leave a very limited number of current EVs that qualify.
Many automakers are already aligning their business strategies to move EV and battery assembly to US soil in order to re-qualify, but getting these facilities up and running will take time.
In the meantime, it might be worth considering a used electric vehicle to benefit from the revised federal tax credit of up to $4,000. That’s how it works.
This is how the current tax credit for used electric vehicles works
In a perfect consumer world, all used electric vehicle purchases would be eligible for tax credits from the US government, but unfortunately that’s not the case. As part of the revised provisions of the Inflation Reduction Act signed into law by President Biden, the federal tax credits have been expanded to include revised benefits for the purchase of used electric vehicles. Provided they meet certain criteria. According to IRS:
Beginning January 1, 2023, if you purchase a qualifying pre-owned electric vehicle (EV) or fuel cell vehicle (FCV) from a licensed dealer for $25,000 or less, you may be eligible for a pre-owned clean vehicle tax credit under the Internal Revenue Code section 25E.
Revised terms do not apply to used EVs, which offer a credit of 30% of the retail price (up to $4,000). That should help consumers like you put some loose change in your pocket at the end of the fiscal year. As long as you comply with these terms described by the IRS.
To qualify as a customer you must:
- Be an individual who bought the vehicle for use and not for resale
- Must be an individual (no companies)
- Not be the original owner
- Cannot be claimed as a dependent on another person’s tax return
- You have not claimed any additional clean used vehicle credits in the 3 years prior to the purchase date of the EV
- Modified adjusted gross income may not exceed $75,000 for individuals, $112,500 for heads of household and $150,000 for joint returns
In addition, for used electric vehicles to qualify for federal tax credits, they must:
- Have a sale price of $25,000 or less
- Have a model year at least 2 years earlier than the calendar year you buy it
- For example, a vehicle purchased in 2023 would require a 2021 model year or earlier
- has not already been transferred to a qualified buyer after August 16, 2022
- Have a gross vehicle weight rating of less than 14,000 pounds
- They must be an eligible FCV or plug-in EV with a battery capacity of at least 7 kilowatt hours (kWh).
- Intended for use primarily in the United States
- Purchased from a certified retailer:
- For qualifying used EVs, the dealer will provide you with the necessary information at the time of sale and the IRS
- A used car can only be deducted once in its lifetime
Here are all the used electric vehicles that qualify for tax credits
As promised, here’s the current list of used electric vehicles that qualify for tax credits in the United States, according to the IRS, broken down into all-electric BEVs and plug-in hybrids (PHEVs).
It’s important to note that this isn’t the end, it’s the entire list of used EVs that are eligible for tax credits in the US. Again, according to the IRS:
The manufacturers of the vehicles listed below have provided relevant information and indicated that the vehicles are eligible for the loan provided other requirements are met.
This is simply the list provided by the government, which is constantly updated by both them and us. Additionally, some of these EVs in particular are 2020 or 2021 models and will be almost impossible to find on sale under $25,000. If you’re somehow lucky, you’ll have more power because you can qualify for additional savings.
As always, we recommend speaking directly to a tax advisor and electric vehicle dealer to ensure what you and your new vehicle qualify for. Without further ado, here are the all-electric models that currently qualify:
All-electric models
| Make/Model/Years) | Full tax credit |
| Audi | |
| Audi etron (2019, 2021, 2022) | $4,000 |
| Audi e-tron GT (e-tron GT/RS e-tron GT models) (2022-2023) | $4,000 |
| Audi e-tron S (Standard and Sportback models) (2022) | $4,000 |
| Audi e-tron Sportback (2020-2022) | $4,000 |
| Audi Q4 50 e-tron Quattro (Standard and Sportback models) (2022) | $4,000 |
| bmw | |
| i3 (with or without range extender) (2014-2021) | $4,000 |
| i3 (60Ah) (2017) | $4,000 |
| i3s (with or without range extender) (2018-2021) | $4,000 |
| FIAT | |
| 500e (2013-2019) | $4,000 |
| FORD MOTOR COMPANY | |
| Focus electrics (2012-2018) | $4,000 |
| Mustang Mach-E (2021) | $4,000 |
| GENERAL ENGINES (GM) | open minded |
| HYUNDAI | |
| Ioniq BEV (2017-2019) | $4,000 |
| Kona electric (2019-2021) | $4,000 |
| JAGUAR | open minded |
| KIA | open minded |
| LANDROVER | open minded |
| MAZDA | open minded |
| MERCEDES BENZ | |
| B250e (B Class) (2014-2017) | $4,000 |
| MINI | |
| Cooper SE hardtop (2020-2021) | $4,000 |
| MITSUBISHI | open minded |
| i-MiEV (2012-2014, 2016-2017) | $4,000 |
| Nissan | |
| SHEET S (2013-2021) | $4,000 |
| LEAF SPlus (2019-2021) | $4,000 |
| LEAF SL (2011-2019) | $4,000 |
| LEAF SL Plus (2019-2021) | $4,000 |
| SHEET SV (2011-2021) | $4,000 |
| LEAF SV Plus (2019-2021) | $4,000 |
| clever | |
| coupe EV (2013-2018) | $4,000 |
| EQ Fortwo Coupé (2019) | $4,000 |
| Convertible EV (2013-2016, 2017-2018) | $4,000 |
| EQ Fortwo Cabrio (2019) | $4,000 |
| SUBARU | open minded |
| TESLA | open minded |
| TOYOTA | |
| RAV4 EV (2012-2014) | $4,000 |
| VOLKSWAGEN | |
| E-Golf (2015-2019) | $4,000 |
| ID.4 First Edition, Pro, Pro S, AWD Pro, AWD Pro S (2021) | $4,000 |
| ID.4 Pro, Pro S, AWD (2022-2023) | $4,000 |
| ID.4 Pro, Pro S, RWD (2022) | $4,000 |
| ID.4 RWD, S RWD (2023) | $4,000 |
| VOLVO | |
| Charge XC40 (2021) | $4,000 |
Used plug-in hybrid electric vehicles that qualify for tax credits
| Make/Model/Years) | Full tax credit |
| Audi | |
| A3 e-tron/ultra (2016-2018) | $4,000 |
| Audi A7 55 TFSI and Quattro (2021) | $4,000 |
| Audi A7 TFSI and Quattro (2022) | $4,000 |
| Audi A8L PHEV (2020) | $4,000 |
| Audi A8L 60 TFSI and Quattro (2021) | $4,000 |
| Audi Q5 PHEV (2020) | $4,000 |
| Audi Q5 55 TFSI and Quattro (2021) | $4,000 |
| Audi Q5 TFSI and Quattro (2022-2023) | $4,000 |
| BENTLEY ENGINES | |
| Bentayga hybrid SUV (2020-2021) | $4,000 |
| Flying track hybrid (2022) | $4,000 |
| bmw | |
| i8 (2014-2017) | $4,000 |
| i8 coupe/roadster (2019-2020) | $4,000 |
| 330e (2016-2021) | $4,000 |
| 330e xDrive (2021) | $4,000 |
| 530e/xDrive (2018-2021) | $4,000 |
| 740e (2017) | $4,000 |
| 740e xDrive (2018-2021) | $4,000 |
| X3 xDrive30e (2020-2021) | $4,000 |
| X5 xDrive40e (2016-2018) | $4,000 |
| X5 xDrive45e (2021) | $4,000 |
| CHRYSLER | |
| Pacifica PHEV (2017-2021) | $4,000 |
| FORD MOTOR COMPANY | |
| C max energy (2013-2017) | $4,000 |
| Escape plug-in hybrid (2020-2021) | $4,000 |
| fusion energy (2013-2020) | $4,000 |
| GENERAL ENGINES (GM) | open minded |
| HYUNDAI | |
| Ioniq PHEV (2018-2021) | $4,000 |
| Sonata PHEV (2016-2019) | $4,000 |
| JAGUAR | open minded |
| JEEP | |
| Wrangler 4xe (2021) | $4,000 |
| KIA | open minded |
| LANDROVER | open minded |
| LINCOLN | |
| Aviator Grand Touring (2020-2021) | $4,000 |
| Corsair Grand Touring (2020-2021) | $4,000 |
| MAZDA | open minded |
| MERCEDES BENZ | |
| S550e (2015-2017) | $4,000 |
| S560e (2020) | $4,000 |
| GLE550e 4M (2016-2018) | $4,000 |
| GLC350e 4M (2018-2020) | $4,000 |
| MINI | |
| Cooper SE Countryman ALL4 (2018-2021) | $4,000 |
| MITSUBISHI | open minded |
| Outlander PHEV (2018-2021) | $4,000 |
| SUBARU | open minded |
| TOYOTA | |
| Prius Prime PHEV (2017-2021) | $4,000 |
| RAV4 PHEV (2021) | $4,000 |
| VOLKSWAGEN | open minded |
| VOLVO | |
| S60 (2019-2021) | $4,000 |
| S90 (2018-2021) | $4,000 |
| V60 (2020-2021) | $4,000 |
| XC60 (2018-2021) | $4,000 |
| XC90 (2016-2021) | $4,000 |
| XC90 excellence (2018-2019) | $4,000 |
Other resources for EV tax credits
While used electric vehicle tax credits have been redesigned and might be the way to go for you personally, there are plenty of other ways to get your year-end cash back from Uncle Sam.
For example, revised terms of the Inflation Reduction Act went into effect on January 1, 2023, allowing federal tax credits for new electric vehicle purchases to be extended through the next decade, while electric vehicles from American automakers like Tesla and GM again qualify.
That being said, the capital is still trying to sort out many of these conditions to determine which vehicles qualify, so things are a little cloudy at the moment, but you may be able to claim tax credits beforehand Battery assembly requirements join later this year.
learn more about Federal tax credits for new EV purchases here.
Whether it’s a new or used EV purchase that ends up being right for you, you may still be able to claim additional state-level perks depending on where you live. Credits, exemptions, and other benefits might be available for purchase, lease, or for relevant equipment such as home charger installation.
You can check what EV-centric benefits might be available to you, sorted by state, here.
We want to reiterate one last time that we recommend doing your own research and speaking directly to a tax expert and electric vehicle dealer to ensure exactly what you and your vehicle purchase qualify for.
Good luck with your EV search!
FTC: We use income earning auto affiliate links. More.
