The used electric car tax credit was a monumental addition to the Inflation Reduction Act. Worth up to $4,000, the credit is applicable for used EVs, PHEVs, and FCEVs selling for under $25,000. However, there was an issue. Used Teslas were never on the Internal Revenue Service's qualification list.
In a recent change of events, used Teslas now appear to qualify for the $4,000 used EV tax credit. The IRS updated its website on August 3, 2023, providing a link to the EPA's website instead of the list of qualified manufacturers. The EPA's site displaysAs evidence that this may signify a change within the IRS' qualification procedures, the EPA tool won't display the Honda Accord PHEV, meaning it won't qualify.
Individuals must make under $75,000 annually to claim the credit. The head of household can make up to $112,500, and joint filers can make up to $150,000.The car must be at least two years old. The vehicle can be a plug-in hybrid, though the battery would have to be at least 7kWh , and the Honda Accord Plug-in Hybrid won't qualify, among others).A previous owner cannot have already claimed the used EV tax credit on it.