With the passage of the Inflation Reduction Act, (IRA), numerous EV (electric vehicle) policies and incentives are now in place to help accelerate the electrification and decarbonization of our transportation system. In Washington, about 40% of our overall carbon emissions come from the transportation sector. Fortunately, our electrical energy grid is much cleaner than most parts of the country because of our hydropower resources.
With Washington State’s 2022 passage of the Clean Car Bill, Puget Sound Energy’s mandated divestment of coal in it’s energy portfolio and the ongoing development of clean, renewable energy projects by homeowners and various stakeholders, our state likely may lead the nation in the decarbonization effort – and we’ll all benefit with cleaner air and water.
The IRA also includes solar incentives that you can learn about on the residential solar incentives page at Puget Sound Solar. We’re going to focus on the EV incentives for consumers in this article and will post about EV incentives for businesses in the near future.
New Electric Vehicles Incentives For Consumers
The Inflation Reduction Act‘s electrical vehicle incentives include provisions to promote US manufacturing while also softening costs for consumers. Several older EV incentives were extended, modified or eliminated with the passage of the IRA. Some incentives are designed to help build out the charging infrastructure to support these vehicles.
Previously, some existing popular EV’s were no longer eligible for incentives because they hit a 200,000 unit cap. Under IRA, the cap is removed and these models are once again eligible for the tax credit.
New electric vehicles will be eligible for a $7,500 tax credit (delivered at the point of sale in 2024) however final assembly of these EV’s must be in the US and the materials must be sourced in the US or with a US free trade partner.
Used electric vehicles will now be eligible for tax credits.
Who’s Eligible For The EV Incentives?
Eligibility to receive the tax credit on new EV’s is limited by a consumers Adjusted Gross Income.
- Single tax filers can earn up to $150,000 when purchasing a new EV.
- Head of Household can earn up to $225,000 when purchasing a new EV.
- Joint filers can earn up to $300,000 when purchasing a new EV.
Which New Vehicles Are Eligible For The EV Incentives?
- The Maximum Suggested Retail Price is $80,000 for new vans, sport utility vehicles and pickup trucks.
- The Maximum Suggested Retail Price is $55,000 for all other new vehicles.
Which Used Electric Vehicles Are Eligible For The EV Incentives?
Incentives were created to help low to moderate income households make the transition to electric vehicles. (These EV’s are not subject to the same battery and mineral resourcing requirements as new EV’s.)
- Used EV’s will be eligible for a tax credit up to $4,000 or 30% of the vehicle cost up to a Maximum Vehicle Sales Price of $25,000.
Who’s Eligible For The Used EV Incentives
As with new EV’s, there’s some eligibility criteria based on a person’s Adjusted Gross Income for purchasers of Used EV’s.
- Single tax filers can earn up to $75,000 when purchasing a used EV.
- Head of Household can earn up to $112,500 when purchasing a used EV.
- Joint filers can earn up to $150,000 when purchasing a used EV.
EV Charging Station Incentives For Individuals
Incentives were also created to build the infrastructure needed to power all these electric vehicles, so if you install a home EV charging station, you may be eligible for a 30% tax credit (up to $1,000) toward the EV charger and installation costs. There is no Washington state sales sax on EV Charging station installation costs, roughly saving another 10%.
In 2023, the tax credit for business and home installations, will apply to other EV charging equipment like bidirectional (i.e., two-way) chargers.
Other EV Incentives May Be Available
Check with your utility, county, regional organization, or municipality to see if other rebates are available for buying an EV or installing an electric vehicle charging station.
When you’re ready to get your EV charging station installed, please give us a call at 206-706-1931 or fill out our contact form and tell us a little about your project. We can help you select the right EV charger for your budget and driving needs.