Here are the 10 most important things to know about the 2024 EV tax credits as of Jan. 1:
1. A tax credit of up to $7,500 is available on new and used EVs that meet certain criteria.
2. The amount of the tax credit depends on where the EVs are made, where their battery components and minerals come from, how much they cost, and the buyer's annual income.
3. The credit will be available for eligible buyers as a discount at the dealership when they buy the vehicle. No more waiting for tax season.
4. To qualify, the EV must be manufactured in North America and have an MSRP below $80,000 for an SUV and $55,000 for a sedan, wagon, or hatchback.
5. To qualify for the first $3,750, some of the EV's battery components must be produced or assembled in North America.
6. To get another $3,750 (for the full $7,500 tax credit) a portion of the critical minerals in the EV battery must be mined or processed in the U.S. The minerals also could come from a country that is a U.S. free- trade agreement partner. Or, they must have been made from materials recycled in North America.
7. The percentages of the components or minerals that need to be sourced under those rules go up every year, beginning this year.
8. Starting in 2024, EVs with components from countries that have been designated "foreign entities of concern" (FEOC) will no longer be eligible for a tax credit. FEOC includes entities that are owned by, controlled by or subject to the jurisdiction or direction of a government of a foreign country that is a covered nation. Covered nations currently include China, Russia, Iran, and North Korea.
9. The tax credit is nonrefundable.
10. Check to be certain your dealer can give you the EV Tax credit. The dealer must be registered on a new platform, IRS Energy Credits Online, for a buyer to receive a point-of-sale EV tax credit.
