How Does the Federal Tax Credit for Electric Cars Work?

Rising gas prices in Mamaroneck and everywhere else have made electric cars like the BMW iX models more appealing. But the federal electric car tax credit sweetens the deal even more. But is there an EV tax credit for NY residents? Keep reading to find out.

Is Every Electric Car Eligible for the Electric Car Tax Credit?

The U.S. Government made tax credits available for electric vehicles and hybrid vehicles. But this was limited per manufacturer to the first 200,000 models sold. After that, the credit will be available for two more quarters at reduced rates. For example, Tesla and GM models are no longer eligible, while BMW vehicles still are eligible. How can you find out if the model you’re interested in buying is eligible for the electric car tax credit? You can check the EPA’s website. This credit is not available for Mamaroneck drivers who lease instead of buy.

How Does the Federal Tax Credit for Electric Cars Work?

So, how does the federal tax credit for electric cars work, exactly? The tax credit ranges from $2,500 to $7,500, depending on the car’s battery capacity and GVWR. You can use the tool on the EPA website we linked to above to find out how much your car is eligible for. Once you find out how much your car is eligible for, fill out the appropriate tax form and deduct that amount from the taxes you owe. Your tax credit can not exceed the amount of taxes you owe. So, if you owe $5,000 in taxes, and your maximum EV tax credit is $7,500, you can only claim $5,000.

How to Claim Your Electric Car Tax Credit

• Calculate how much you owe in taxes.
• Check how much in tax credits your vehicle is eligible for.
• Deduct that amount from the taxes you owe (tax form8936).

Is There an EV Tax credit for NY Residents?

What about state government incentives? Is there an EV tax credit in NY? Instead of a tax credit, the State of New York offers a $2,000 rebate off of the purchase or lease price of an electric or plug-in hybrid car. Harrison drivers can learn more about it on the New York government’s website.

Check Out the Electric Vehicles Available from BMW of Mamaroneck

Are you ready to enjoy the government incentives available to drivers of electric vehicles? Why not check out our wide selection of electric and hybrid vehicles that are available to order? If you’d like to learn more, check out our post on the difference between hybrid and electric cars. We’re just down the road from New Rochelle. So, drop by or contact us today.