A tax credit known as the IRC 300 New Qualified Plug-In Electric Drive Motor Vehicle Credit provides a tax credit to qualified drivers. This includes hybrid and electric vehicles.
For a vehicle to qualify it must:
- Have at least four wheels
- Have a gross vehicle weight of under 14,000 pounds
- Draw energy from a battery with at least 4 kilowatt hours
- May be recharged from an external source
The tax credit for plug-in vehicles applies to vehicles purchased or placed in service on or after January 1, 2010.
Hybrid vehicles have drive trains powered by both an internal combustion engine and a rechargeable battery. Many currently available hybrid vehicles may qualify for the credit. Taxpayers may claim the credit on their tax returns only if they placed a qualified vehicle in service in 2010.
The credit is available only to the original purchaser of a new qualifying vehicle. If the qualifying vehicle is leased the credit is available only to the leasing company.
To find out whether your car qualifies for the hybrid tax credit and the maximum amount of that credit, see the New Qualified Plug-In Electric Drive Motor Vehicle Credit page on the IRS website.
For information or questions about tax credits, contact J Kelly & Associates.