What is the Used Clean Car Credit?

Interested in buying a used electric car around Amherst? Since January 1st, 2023, purchasing a used EV or FCV from a licensed dealership for $25,000 or fewer makes you eligible for a used clean vehicle tax credit. Not sure what the used clean car credit is? 

This used federal EV tax credit update, also known as the previously owned clean vehicle credit, offers credit up to 30% of the sale price up to a maximum threshold of $4,000. This credit is nonrefundable and can’t be applied to future tax years. Find out more about how the used clean car credit and the Inflation Reduction Act go together with the experts at Basil Resale Sheridan below!

Who Qualifies for the Used Federal EV Tax Credit Update?

You may qualify for a credit if you’ve bought a pre-owned, qualifying plug-in electric vehicle or fuel cell vehicle, including cars and light-duty trucks in the Clarence area. According to the Internal Revenue Code Section 25E, the qualifications are as follows: 

• Be an individual who bought the vehicle for use and not for resale
• Not be the original owner
• Not be claimed as a dependent on another person’s tax return
• Not have claimed another used clean vehicle credit in the 3 years before the purchase date

In addition, your modified adjusted gross income (AGI) may not exceed:

• $150,000 for married filing jointly or a surviving spouse
• $112,500 for heads of households
• $75,000 for all other filers

How Do the Used Clean Car Credit and the Inflation Reduction Act Go Together?

Have you bought a new-to-you, qualifying plug-in electric vehicle in 2022 or in any prior years? You may be eligible for a clean car tax credit of up to $7,500 under Internal Revenue Code Section 30D. You can potentially qualify for $2,917 for a vehicle with a battery capacity of at least 5-kilowatt hours (kWh), plus $417 for each kWh of capacity over 5 kWh. The maximum credit available is $7,500, it’s not refundable, and you can’t apply any leftover credit to future tax years.

Claim Your Used Clean Car Credit Today!

Ready to claim your used clean car credit on one of the EVs in our pre-owned vehicle inventory? Then you’ll want to fill out Form 8936, Qualified Plug-In Electric Drive Motor Vehicle Credit (Including Qualified Two-Wheel Plug-In Electric Vehicles and New Vehicles), and file it with your tax return for the year you took possession of the vehicle to claim your used clean vehicle credit. Feel free to get in touch with the Finance specialists at Basil Resale Sheridan if you have any further questions!