Additional Tax Credit Eligibility for New EVs: 

New vehicles also must meet either or both of the mineral and battery component requirements to qualify.

Additional Tax Credit Eligibility for Used EVs:
 Previously owned EVs, hybrids, and plug-in hybrids are only eligible for a tax credit once in the vehicle’s lifetime.

Lease Credits on EVs:
Certain EVs, like the Subaru Solterra, are eligible for a lease credit of $7,500 through Subaru Motors Finance. This $7,500 credit is often used to lower monthly lease payments or applied as a rebate.

Claiming a Tax Credit on a New EV

Now buyers have the option to claim the credit as a rebate at the time of purchase and apply it to the cost of their new EV as a discount from the dealer. The dealer then completes documentation and submits it to the IRS, with the IRS reimbursing the dealer the total cost of the tax credit. This frees the buyer from having to complete paperwork themselves and from having to wait months or longer to access their tax credit. 

Since the tax credit is non-refundable (i.e., taxpayers who owe less than the credit they qualify for in income tax cannot receive the difference as a tax refund), claiming the EV tax credit as a rebate is one way to ensure that buyers receive the full amount to which they are entitled. 

New buyers also have the option to apply the credit to their income tax owed the following year. If this is the preferred option, they can still opt to fill out the necessary paperwork (Form 8936) and file it with their taxes.

Claiming a Tax Credit on a Used EV

If you purchased a pre-owned EV, you will need to fill out Form 8936 from the IRS to claim your tax credit. This form will need to be filed with your tax return in the year you purchased the vehicle. Your submission must also be accompanied by the vehicle identification number (VIN).


State Specific EV Tax Credit

The Federal EV tax credit may not be the only incentive available to you. You may be able to take advantage of additional tax credits, discounts, as well as state and local financial incentives depending on your location and other eligibility criteria. Your employer may also offer an incentive or credit. With state tax laws and other requirements changing all the time, ask your local Subaru retailer to help you explore qualified options or check out the latest resources from the U.S. Department of Energy to see your state’s available incentives.



Can I claim the EV tax credit for a used vehicle?

Yes. You can claim a tax credit of 30 percent of the purchase price up to $4,000 on a qualifying used EV, hybrid, or plug-in hybrid priced $25,000 or less, as long as it has not been used to claim the EV tax credit in the past. Pre-owned electric vehicles are eligible for a tax credit two years after their model date. For instance, a 2023 Solterra would be eligible for a used EV tax credit in 2025.

Do I get money back from EV tax credit?

No. The EV tax credit is non-refundable, meaning it cannot result in a tax refund, even if the credit exceeds your total tax liability.

Are there any income limits for claiming the EV tax credit?

Yes. The income limits vary depending on your IRS filing status and depending on whether you are claiming a credit on a new or previously owned vehicle. As the income limits may change from year to year, it is best to consult the latest information from the IRS to determine if you qualify based on your income.

Can I claim EV tax credits if I lease the vehicle?

If you are leasing an EV, you cannot claim the federal EV tax credit on your vehicle the same way you would if you were purchasing it outright; however, the vehicle still may qualify for the credit. In that case, the tax credit goes to the institution leasing you the vehicle, which could then pass those savings on to you in the form of a rebate or reduced monthly payments. 

Leased EVs are classified as commercial vehicles, which are not subject to the same stringent battery requirements as non-commercial vehicles to qualify for the credit. This allows a wider range of EVs to be eligible for the tax credit when leased and may broaden your available options.

Are there any price caps on vehicles eligible for EV tax credits?

Yes. The price caps may change over time and with inflation, but as of January 2024, to qualify for the tax credit new EVs are capped at $55,000 MSRP for cars and $80,000 MSRP for trucks, vans, and SUVS. Previously owned EVs are capped at $25,000. Current price caps on EVs are available from the IRS. 

Explore the Future of Electric Vehicles with Subaru

Whether you’re the proud owner of an electric vehicle today, or plan to buy one in the future, Subaru is here for you. Learn more about electric vehicles, including our Solterra.

Information accurate as of May 2024. Verify tax credit rules prior to purchase and consult your tax professional for additional information.