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Am I eligible for the used electric vehicle tax credit?
Am I eligible for the used electric vehicle tax credit?

Understand the rules around personal and vehicle eligibility for the used electric vehicle tax credit.

Kevin Egolf avatar
Written by Kevin Egolf
Updated over a week ago

To confirm eligibility of the used electric vehicle tax credit (also referred to as the previously-owned clean vehicle tax credit or the 25E credit) there are three categories of details to review: personal; vehicle; and seller/dealer.

After reviewing the qualification details below, we recommending reading our information on how to obtain the used electric vehicle tax credit.

Personal

  • The buyer of the vehicle must have annual income at or below thresholds for either the year the vehicle was purchased or the prior year. If the vehicle is purchased in 2024 that means the buyer only needs to be under the threshold for the 2023 calendar year taxes (return filed in 2024) OR the 2024 calendar year taxes (return filed in 2025). A buyer who is over the limit one year but not the other is still eligible.

  • Income thresholds:

    • joint or a surviving spouse filer threshold of $150,000;

    • head of household filer threshold of $112,500; or

    • single / individual / all other filers threshold of $75,000.

  • Be buying the vehicle for use (not resale)

  • Not be claimed as a dependent on another person’s tax return

  • Not have claimed another used clean vehicle credit in the 3 years before the purchase date

Vehicle

  • The vehicle sale price must be under $25,000.

    • Sale price includes all dealer-imposed or added costs or fees except those that are required by law (such as taxes or title and registration fees).

    • It is important that the seller does not add new tires, paint coating, window tinting or other costs / fees that would increase the sale price of the vehicle.

  • The model year of the vehicle must be at least 2 years earlier than the calendar year the vehicle was purchased. For example, a vehicle purchased in 2024 would need a model year of 2022 or older.

  • The vehicle must not have already been sold/transferred to a new owner after August 16, 2022. For example a 2019 Tesla Model 3 that was sold as a used vehicle in 2021 could still be eligible for the credit. That same vehicle if it was sold as a used vehicle in December 2022 would not be eligible for the credit.

    • The seller of the vehicle will have access to these records and should be able to confirm that the vehicle is eligible for credit.

  • The vehicle must be a all-electric, plug-in hybrid, or fuel cell electric vehicle with at least 7 KW of battery capacity. This covers most BEVs (battery electric vehicles) and PHEV (Plug-in hybrid electric vehicles).

Seller/Dealer

  • The seller/dealer must have registered with IRS Energy Credits Online.

  • As part of the sale process, the seller will submit a “time of sale report” (also called a “seller report”) to the IRS Energy Credits Online portal. Buyers will want to receive a copy of this submission.

Now that you assessed the eligibility criteria for used EVs, we encourage you to read our FAQ on what you need to do to obtain the used electric vehicle tax credit.

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