Is There A Tax Credit For Used Electric Vehicles?

Eligibility for the Used EV Tax Credit

These days, it's natural to be curious and ask, "Why buy an electric car?" The expansive used electric car tax credit is just one of the answers. However, in order to benefit, you'll need to follow some specific criteria. To receive your rebate, the following conditions must be met.

You:

• Bought an EV or FCV for use, not for resale.
• Aren't the original owner.
• Aren't dependent on someone else's tax return.
• Haven't claimed this credit in the three years before the purchase.
• Are not making more than $150,000 in a joint household, $112,500 as the head of a household, or $75,000 in all other conditions.

The Vehicle:

• Has a sale price of $25,000 or less. This includes dealer-imposed costs and fees, like accessories and optional equipment, but not government-required fees, like taxes or title and registration.
• Is a model year of two years older than the calendar year on the date of purchase.
• Was not transferred after August 16th, 2022, to a qualified buyer.
• Has a GVWR of less than 14,000 pounds.
• Has a battery capacity of less than seven kW hours.
• Will be used primarily in the U.S.
• Comes from a licensed dealer that reports required information to you. Necessary information includes the official seller's name, ID number, sale date and sale price, maximum credit allowable under IRC 25E, VIN, and battery capacity.

How To Claim the Used EV Tax Credit

Thankfully, claiming your federal used EV tax credit is straightforward once you understand the process and get the required information from your dealer. Once you make the purchase:

• Get a time-of-sale report: This paper copy should be kept in your records. The dealer should have sent the IRS a copy.
• File Form 8936 with your tax return: If you have any questions on how to file this form, contact a tax expert or visit the IRS website for detailed instructions.

If you have all the required information regarding your purchase and fall under all the above criteria, your used electric vehicle tax credit should be represented in your tax returns.

California Used EV Incentives

Depending on your address, you might access a more specific used EV tax credit. 2025 brings many opportunities for eco-conscious drivers, but these can vary based on your ZIP code and the company you work with. Be on the lookout for additional used clean vehicle credit opportunities like:

• Pacific Gas and Electric Rebates
• Consumer Assistance Programs
• Transportation Authority of Marin EV Supply Equipment Grants
• Alternative Fuel Infrastructure Tax Credits
• Decal for High Occupancy Vehicle Lane Exemptions
• Special EV Rate for Home Charging
• FasTrak Discounts for EVs on Bay Area Bridges

While we're not tax experts, our representatives at Toyota of Marin would be happy to help you learn about special used EV tax credit incentives that get you on the road in one of our used electric cars for sale. Purchasing and driving an evolutionary Toyota bZ4X or similarly eco-friendly vehicle through California is more affordable than ever, thanks to the $4,000 used EV tax credit and additional incentives.