The One Big Beautiful Bill Act (OBBBA), which was enacted in July 2025, eliminated all existing clean vehicle tax credits as of September 30, 2025. The clean vehicle tax credit was originally introduced in 2008 as an incentive for Americans to opt for an electric or hybrid vehicle as opposed to a gas vehicle. In 2022, the Inflation Reduction Act expanded eligibility and specified new requirements as electric vehicles became more prevalent in our society. However, under the OBBBA provisions, all business and personal use vehicles purchased after September 30, 2025, are no longer eligible for clean vehicle tax credits. Credits for EV charging equipment are still allowed until June 30, 2026, offering a slight incentive to choose the electric vehicle route.
Taxpayers who purchased an electric or hybrid vehicle for personal or business use before September 30, 2025, may still be eligible for a credit. New vehicles purchased for personal use before the end date may be eligible for up to $7,500 in tax credits, if the purchase price was under $55,000 for sedans ($80,000 for larger vehicles), and if additional requirements are met. Used vehicles must be at least two years old, cost no more than $25,000, and be purchased from a certified dealer. Additionally, for new EVs, an eligibility threshold must be met: taxpayer’s AGI cannot exceed $150,000 for single filers ($300,000 or MFJ and $225,000 for HOH). For used EVs, these numbers are cut in half. Click here for requirements for new or used clean vehicles purchased for business use.
If you need assistance determining eligibility for credits or other tax savings opportunities, please contact your GYF Tax Executive at 412-338-9300. Additional information can be found on the IRS website
