Post by Barry Kresch
Tax Credit for Purchase and Installation of an EV Charger
The recently passed Inflation Reduction Act has amended US Code 26, Section 30C to reinstate a tax credit for the purchase and installation of an EV charger.
This credit had been in the tax code a while. Every year it expired and every year it got extended for one year, sometimes, as is the case now, after the fact. It had expired on December 31, 2021. It is now folded into the 10-year time horizon of the IRA. Here are the key things to know:
- The credit is for 30% of the combined cost of the hardware and installation, capped at $1000. This is the same as what it used to be.
- This has nothing to do with the utility incentives. Any charger qualifies.
- It is retroactive to January 1, 2022. If you bought a unit earlier this year, include it in your tax return.
- This incentive becomes more restrictive beginning in 2023, going through 2032. It then applies only to low income communities and rural census tracts.
- Use IRS form 8911 to claim the credit.
There is a commercial version of this with higher amounts.
Standard caveat: Always check with your CPA.
How do you recommend a consumer go about deciding whether to use the federal or state incentive? Can they use both?
I emailed the utilities to ask for their position but have not yet heard. My reading of it is that one can use both. If the utilities have a problem with that, it would be a real challenge. One would have the cash from the utility in hand before tax filing is due. They would have to claw back, yikes.