Porsche, Audi and Kia said their electric vehicles will no longer qualify for $7,500 tax credits in the United States when President Biden signs (which he now has) the Inflation Reduction Act and its new electric vehicle subsidy (rebate/discount) system into law. The brands urged would-be buyers to place firm orders for models such as the Porsche Taycan, Audi e-Trons or Kia Niro EVs.

SEE ALSO Official IRS Vehicle List

Enacted August 16, 2022 The Inflation Reduction Act of 2022 (Public Law 117-169) amends the Qualified Plug-in Electric Drive Motor Vehicle Credit (IRC 30D), now known as the Clean Vehicle Credit, and adds a new requirement for final assembly in North America that takes effect on August 16, 2022. Additional provisions will go into effect on January 1, 2023. Further guidance on these provisions is forthcoming. Find more information about the credit from the Internal Revenue Service.

The following table provides a list of Model Year 2022 and early Model Year 2023 vehicles with final assembly in North America based on data submitted to the National Highway Traffic Safety Administration (NHTSA) and FuelEconomy.gov as of August 1, 2022. Note that for some manufacturers, the build location may vary based on the specific vehicle, trim, or the date in the Model Year when it was produced because some models are produced in multiple locations. The build location of a particular vehicle should be confirmed by referring to its Vehicle Identification Number (VIN) using the VIN decoder described below or an information label affixed to the vehicle.

As vehicle manufacturers continue to submit the applicable vehicle identification information to the relevant government agencies, this list will be updated as more information becomes available.

NOTE: Some manufacturers that have vehicles assembled in North America have reached a cap of 200,000 EV credits used and are therefore not currently eligible for the Clean Vehicle Credit.

In addition to the list of vehicles with final assembly in North America listed above, the build location of a particular vehicle should be confirmed by the VIN or an information label affixed to the vehicle. The U.S. Department of Transportation's NHTSA provides a VIN decoder that can be used to look up the vehicle's assembly location using these steps:

Find additional directions for using the VIN decoder to identify a vehicle's build plant and country of manufacture.

All-electric and plug-in hybrid cars purchased new in or after 2010 may be eligible for a federal income tax credit of up to $7,500. The credit amount will vary based on the capacity of the battery used to power the vehicle. State and/or local incentives may also apply.

Small neighborhood electric vehicles do not qualify for this credit, but they may qualify for another credit.

Congress recently passed new legislation—the Inflation Reduction Act of 2022—which changes credit amounts and requirements for clean energy vehicles.

Preliminary guidance from the Internal Revenue Service addresses two important issues regarding vehicles purchased in 2022:

We will provide more information when IRS releases additional guidance on the credits.

Qualified Plug-In Electric Drive Motor Vehicles (IRC 30D)

To be certified for the credit by the manufacturer, the vehicle must meet the following requirements:

The following requirements must also be met for a certified vehicle to qualify:

The credit begins to phase out for vehicles at the beginning of the second calendar quarter after the manufacturer has sold 200,000 eligible plug-in electric vehicles (i.e., plug-in hybrids and EVs) in the United States as counted from January 1, 2010. IRS will announce when a manufacturer exceeds this production figure and will announce the subsequent phase out schedule (Plug-In Electric Drive Motor Vehicle Credit Quarterly Sales).

Fill out Form 8936, Qualified Plug-in Electric Drive Motor Vehicle Credit.

For vehicles acquired for personal use, report the credit from Form 8936 on the appropriate line of your Form 1040, U.S. Individual Income Tax Return.

For vehicles purchased in 2010 or later, this credit can be used toward the alternative minimum tax (AMT).

If the qualifying vehicle is purchased for business use, the credit for the business use of an electric vehicle is reported on Form 3800, General Business Credit.

The information on this page should not be viewed as an official or legally binding document. Other requirements or exceptions may apply. For more detailed information, please consult an IRS tax representative and/or official IRS publications.

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