How Does the EV Tax Credit Work?

Electric vehicles are popular around and offer many benefits, such as freedom from high gas prices and being more environmentally friendly. Another benefit of electric cars is tax credits. If you’re wondering about tax credits for electric cars, you’re in the right place! Many Elmhurst customers ask us at Roesch Ford, “How does the EV tax credit work?” We are here to help! Learn more about Federal EV tax credits and other Illinois tax credits here, and if you haven’t already purchased an electric vehicle or hybrid, contact us at Roesch Ford to get behind the wheel of one! 

Federal Tax Credits for Electric Cars

According to data from the U.S. Energy Information Administration (EIA), approximately 90% of the energy used in transportation around the United States comes from petroleum. To encourage more Elmhurst drivers to choose electric vehicles, the federal government offers many tax incentives, including:

• Up to $7,500 in tax credit for PHEVs (plug-in electric vehicles)
• 30% tax credit on electric vehicle charging infrastructure—up to $1,000 for consumers and $30,000 for businesses

In addition, many auto insurance companies around Addison offer significant discounts on insurance rates for certain hybrid and electric vehicles that meet specific criteria.

Illinois Electric Vehicle Rebate Program

The great state of Illinois also occasionally offers rebate programs on EVs depending on the availability of funds. When the rebate program is offered, qualifying Illinois residents that purchase a new or used all-electric vehicle from specific Illinois-licensed dealerships are eligible for an Illinois Electric Vehicle Rebate. See the details below:

• $4,000 rebate for the purchase of an all-electric vehicle (excludes electric motorcycles)
• $1,500 rebate when purchasing an all-electric motorcycle.
• Buyers must apply for the rebate during an open rebate cycle and within 90 days of the purchase. Application forms are available on the webpage during open rebate cycles.

Eligibility requirements for an EV rebate in Illinois include the following:

• The buyer must reside in Illinois at the time they buy the electric vehicle and when the rebate is issued.
• The EV must be purchased from a dealer located within Illinois and licensed by the Illinois Secretary of State.
• Rented or leased vehicles do not qualify.
• The EV cannot have been used for a previous EV rebate under the program in Illinois.
• Only individuals (not organizations) can qualify, and they can only receive one rebate. 
• The rebate amount cannot exceed the purchase price of the electric vehicle.
• The purchaser must keep the vehicle for a minimum of 12 consecutive months immediately after the purchase date.

Test-Drive an Electric Vehicle at Roesch Ford

Now that we’ve answered the question, “How does the EV tax credit work?” please don’t hesitate to contact us with any additional questions about federal EV tax credits. We are conveniently located near Villa Park and are always at your service. If you need auto maintenance or repairs on your EV, we can also help with that. Just schedule a service appointment online.