How do you claim your 2023 EV tax credit?

Federal EV tax credits are available to people who buy a new plug-in electric vehicle or fuel cell vehicle from a qualified manufacturer. Starting in tax year 2023, the credit is worth up to $7,500 for new EVs and up to $4,000 — limited to 30% of the sale price — for used EVs. You need to meet income requirements to qualify. Married couples filing jointly may earn up to $300,000 per year, heads of households can earn up to $225,000 per year, and all other tax filers can earn up to $150,000 annually for eligibility.

What states have the most EV incentives?

California, Vermont, Connecticut, Oregon, and Maine all offer rebates of $7,500 or more when you buy or lease a qualifying electric vehicle and follow program requirements. Depending on the program, the car may be new or used.

Does Florida offer incentives for electric cars?

Florida doesn’t have incentives for private residents buying an electric car, but several local utility companies offer bill credits or discounted rates to residential customers who charge their electric vehicles during off-peak hours and small rebates for buying electric vehicles.

How do tax incentives work for electric cars?

To claim the federal tax credit, you need to include Form 8936 when you file your federal income tax return. This form also helps you determine your eligibility for federal tax credits.

Which state has the most electric cars?

As of the end of 2021, California was the state with the most electric vehicles in the U.S., with 39% of EVs nationwide. Florida has the second-highest count of EVs, followed by Texas.

Electric Vehicle Incentives by State (2023)

If you own an electric vehicle or you’re buying one soon, you may qualify for programs that help you recoup the purchase price. The federal government provides an income tax credit of up to $7,500 for all-electric, plug-in hybrid, and fuel cell electric vehicles purchased before Jan. 1, 2023.^[1] If you missed that cutoff, you may qualify for a whole new slate of federal tax breaks in 2023 and beyond.^[2]

You may find programs for your state or city, as well. Many state and local governments, nonprofits, and utility companies offer tax credits and rebates to reward you for going green. Every program is different, so you’ll need to go through the details to see if you and your vehicle qualify. Here’s what to know before heading to the dealership.

Electric vehicle definitions
Hybrid and electric vehicle incentives by state
States with the best EV incentives
Electric vehicle incentives FAQs

Electric vehicle definitions

Some EV incentive programs restrict eligibility to certain types of cars, so it helps to understand some of the terms you may come across. Here’s a rundown of the major alternative-fuel vehicle types.

Alternative-fuel vehicles (AFVs) are cars that run on alternative fuel — such as electricity, biodiesel, or propane — rather than gasoline.
Battery-electric vehicles (BEVs) are powered with a battery and an electric motor.
Electric vehicles (EVs) use a battery and an electric motor, and they include battery electric vehicles (BEVs) and plug-in hybrid electric vehicles (PHEVs).
Plug-in hybrid electric vehicles (PHEVs) run on a combination of gasoline and electricity, so a battery and an electric motor in addition to a gasoline tank and an internal combustion engine power the car.
Fuel-cell electric vehicles (FCEVs) use pure hydrogen gas stored in a tank inside the vehicle. These cars produce zero tailpipe emissions.
Zero-emission vehicles (ZEVs) use alternative fuel sources, so they don’t produce greenhouse gas emissions and pollutants.^[3]

Keep in Mind

When you own an electric vehicle, you may also need electric vehicle supply equipment (EVSE), also known as charging stations, to recharge its batteries.

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Hybrid and electric vehicle incentives by state

The table below outlines the incentives you may receive when you purchase or lease an electric vehicle. Some are available at the state level, while others are through local nonprofits and utility companies. Many utility companies also offer rebates, bill credits, or other incentives for installing an EV charger. Customers can also typically receive “time of use” rates, which are discounted rates for charging during off-peak hours.

These perks may change over time, and this list is not exhaustive. If you don’t see a relevant incentive listed here, check with your state or local government or utility company for a list of savings options.

State	Electric Vehicle Incentive
Alabama	Alabama Power offers discounted time-of-use rates for charging an EV during off-peak hours.
Alaska	Chugach Electric Association offers a $200 bill credit per residential EV charger. Alaska Power & Telephone Co. provides a one-time bonus of $1,000 when customers buy a new or used EV. Alaska Electric Light & Power provides a discounted time-of-use rate to residential customers who own or lease a qualifying EV.
Arizona	Arizona Public Service, Salt River Project, and Tucson Electric Power customers can receive rebates or bill credits for purchasing a qualifying EV charger. APS and TEP also offer discounted time-of-use rates.
Arkansas	No residential or private customer incentives
California	Clean Vehicle Rebate Project offers rebates of up to $7,000 when buying or leasing a qualifying EV. California Air Resources Board offers grants of up to $5,000 to people with qualifying incomes who buy an EV. Many utility companies and nonprofits also offer incentives for purchasing or leasing an EV or installing a qualifying charging station.
Colorado	Statewide tax credit between $1,500 and $8,000 for purchasing or leasing an EV or PHEV. Gunnison County Electric Association customers may receive rebates for buying an EV, installing a qualifying EV charger, and signing up for time-of-use rates. They may also borrow an EV for up to seven days at no cost and with no mileage restrictions.
Connecticut	Statewide rebate of up to $9,500 for purchasing or leasing a qualifying EV or hydrogen FCEV. Eversource provides rebates for qualifying EV chargers. Norwich Utilities customers receive a rebate of up to $1,000 for purchasing or leasing an EV and an additional rebate for installing a qualifying charger, for $5,000 total.
Delaware	Statewide rebate of up to $2,500 for buying or leasing a qualifying EV before April 30, 2023. Delmarva Power customers get special time-of-use rates when they own an EV. Delaware Electric Cooperative provides a $200 bill credit rebate and a $5 monthly bill credit for charging during off-peak hours.
Florida	Orlando Utilities Commission customers receive a $200 rebate after purchasing or leasing a plug-in EV. Kissimmee Utility Authority customers receive a $100 rebate for purchasing an EV and a $100 rebate for installing home EVSE.
Georgia	Georgia Power customers receive a special rate when charging during off-peak hours. Cobb EMC customers receive an incentive after installing a qualifying EV charger.
Hawaii	Hawaiian Electric offers special rates for charging during off-peak hours for Oahu, Molokai, Maui, and Hawaii Island customers.
Idaho	Residents are exempt from state motor vehicle inspection and maintenance programs when they own EVs, PHEVs, and hybrid electric vehicles.
Illinois	Through June 2026, the Illinois Environmental Protection Agency provides a rebate of up to $4,000 for purchasing or leasing a new or used EV. The amount of the rebate changes in later years.
Indiana	Indianapolis Power & Light and Indiana Michigan Power offer special rates for EV owners.
Iowa	No incentives or programs available for private EV owners.
Kansas	Statewide tax credit of up to $2,400 per EV and other AFV you purchase. Evergy customers may receive a rebate when purchasing a qualifying EV charger and signing up for time-of-use rates.
Kentucky	No incentives or programs available for private EV owners.
Louisiana	Southwestern Electric Power and Entergy eTech customers receive a $250 rebate for installing a qualifying EV charging station.
Maine	Statewide rebate between $1,000 and $7,500 when you buy a qualifying BEV or PHEV.
Maryland	Beginning July 2023, residents can qualify for a statewide excise tax credit of up to $3,000 for purchasing a qualifying EV or FCEV. Some utility companies offer rebates for installing qualifying EV chargers, and they may offer incentives for charging during off-peak hours.
Massachusetts	Statewide rebate of $3,500 for purchasing eligible BEVs, FCEVs, and PHEVs. Some utility companies may offer a rebate for purchasing a qualified EV charger.
Michigan	Some utility companies offer rebates for installing a qualifying EV charger, along with special time-of-use rates. Presque Isle Electric & Gas Co-Op customers receive a rebate of up to $1,500 when purchasing a new or used EV, and a $600 rebate for purchasing and installing a qualifying charging station.
Minnesota	Some utility companies offer rebates for installing a qualifying EV charger, along with special rates for charging during off-peak hours. Xcel Energy also offers incentives for owning an EV.
Mississippi	Entergy offers a $250 incentive for purchasing a qualifying charger. Mississippi Power customers receive rebates of up to $1,250 for buying new or leased EVs and an additional rebate for installing a qualifying EV charger.
Missouri	Evergy and Kirkwood Electric customers receive a rebate for installing a qualifying EV charger.
Montana	No incentives or programs available for private EV owners.
Nebraska	Nebraska Public Power District and Southern Public Power District provide rebates of up to $4,000 when you purchase a new EV in Nebraska. You may also receive a rebate for installing a qualifying EV charging station.
Nevada	NV Energy offers a special rate for charging your EV during off-peak hours.
New Hampshire	New Hampshire Electric Co-op customers can receive a combined rebate for purchasing or leasing a new or used EV and installing an EV charger.
New Jersey	Statewide exemption from paying state sales and use taxes on zero-emission vehicles, including EVs and plug-in electric cars. Statewide incentive of up to $4,000 for purchasing or leasing new, eligible BEVs. Some utility companies offer rebates for installing qualifying charging stations.
New Mexico	Powering New Mexico and El Paso Electric offer rebates for purchasing or installing an EV charging station.
New York	Statewide rebate of up to $2,000 for purchasing or leasing an eligible EV. Statewide income tax credit for 50% of the cost of installing alternative fueling infrastructure, up to $5,000. ConEd and Central Hudson offer incentives for installing qualifying EV chargers.
North Carolina	Duke Energy customers can receive a one-time credit of up to $1,133 to help cover the costs of preparing your home for an electric vehicle charger. Some utility companies provide incentives for installing a qualifying EV charger and special time-of-use rates.
North Dakota	No incentives or programs available for private EV owners.
Ohio	Firelands Electric Cooperative offers a $250 rebate to members who install a qualifying EV charger.
Oklahoma	Oklahoma Electric Cooperative offers a rebate for owning an EV. Public Service Company of Oklahoma provides a cash incentive when customers install a qualifying EV charging station.
Oregon	Oregon’s Clean Vehicle Rebate Program provides rebates of up to $2,500 for purchasing or leasing a BEV or PHEV. Another rebate of up to $5,000 is available for residents who meet income requirements. Central Lincoln and Eugene Water & Electric Board offer incentives for installing a qualifying EV charger. Other utility companies provide incentives for installing a qualifying EV charger.
Pennsylvania	Through June 30, 2023, residents who meet income requirements may qualify for a statewide rebate of up to $2,000 for purchasing certain electric vehicle types. PECO Energy customers can receive a $50 rebate for purchasing a new, qualified EV. Duquesne Light Company offers a one-time $60 bill credit to customers who purchase or lease an EV.
Rhode Island	Statewide rebate of up to $2,500 for purchasing or leasing a new or used BEV or FCEV and up to $1,500 for purchasing or leasing a new PHEV.
South Carolina	Santee Cooper customers can receive a rebate of $250 for installing an EV charger and special rates when charging the vehicle.
South Dakota	Black Hills Energy customers may receive a rebate of up to $500 for installing an EV charger.
Tennessee	Knoxville Utility Board customers can apply for a $400 rebate for purchasing and installing a qualifying EV charger.
Texas	Some utility companies offer rebates for purchasing or installing a qualifying EV charger.
Utah	Rocky Mountain Power offers a rebate for installing a qualifying EV charger.
Vermont	Statewide incentive of up to $8,000 for purchasing a new or used eligible electric vehicle. Utility companies across the state also offer incentives for purchasing or leasing an EV and for installing a qualifying charger.
Virginia	Some utility companies provide incentives to customers who own EVs — through rebates, time-of-use rates, or bill credits.
Washington	Statewide sales and use tax exemption for buying or leasing a new or used EV. Utility companies provide incentives to customers who own EVs — through rebates, time-of-use rates, or bill credits.
Washington, D.C.	Residents may qualify for an income tax credit of 50% of the costs of purchasing and installing an EV charging station and 50% of the costs to convert alternative fuel vehicles, up to $19,000 per vehicle. Utility company Pepco also offers a $50 annual incentive for installing a qualiﬁed EV charger.
West Virginia	Appalachian Power offers an incentive for purchasing or installing a qualifying charger.
Wisconsin	Madison Gas & Electric and Xcel Energy customers can pay $20 a month for the installation and maintenance of a Level 2 EV charger.
Wyoming	Black Hills Energy customers receive a $500 rebate for purchasing and installing a qualifying EV charging station.

States with the best EV incentives

While federal incentives for electric vehicles may be available for anyone in the country, the following states offer more reasons for drivers to switch to EVs.

California

No matter where you live in California, you’re bound to qualify for some type of incentive, rebate, or discount for purchasing, leasing, or owning an electric vehicle. On the state level, the Clean Vehicle Rebate Project provides rebates of up to $7,500 for BEVs and FCEVs and up to $6,500 for PHEVs. And through the California Air Resources Board, applicants can receive grants of up to $5,000 to partly cover the costs of buying an EV or PHEV. Eligibility for both programs is based on income.

Utility companies and nonprofits throughout the state have their own rebate programs, too. For example, the Bay Area Air Quality Management District offers a rebate of up to $9,500 for income-qualifying residents who retire an older car and replace it with a new, qualifying vehicle. Some insurance companies offer policy discounts for owning an EV in California, and some local governments provide free metered parking or free charging stations for electric vehicles.

Vermont

Through the Vermont Drive Electric program, residents can receive up to $4,000 for purchasing a new eligible EV or up to $5,000 for buying a used high-efficiency vehicle. The amount depends on the type of EV (plug-in hybrid or all-electric), filing status, and income level. You can either claim the incentive directly at a participating auto dealer or by filling out an application.

In addition to the Drive Electric initiative, you may qualify for $3,000 through Vermont’s Replace Your Ride program and cash incentives through your local utility company. You can estimate your potential rebate by using an incentive calculator.

Connecticut

Connecticut residents may qualify for a cash incentive through the Connecticut Hydrogen and Electric Automobile Purchase Rebate Program (CHEAPR) when they buy or lease a battery electric vehicle, fuel-cell electric vehicle, or plug-in hybrid electric vehicle.

You’ll first need to choose an eligible vehicle from a licensed Connecticut automobile dealership or the original manufacturer, and the car’s base MSRP can’t exceed $50,000. The standard rebate is worth $750 to $7,500, based on the EV type you purchase, and income-qualified residents may receive a higher rebate of $2,250 to $9,500.

Oregon

The Clean Vehicle Rebate Program provides rebates to Oregon residents who purchase or lease a battery-powered or plug-in hybrid electric vehicle. The incentive starts at $750 for zero-emission motorcycles and goes up to $2,500 for electric cars, though some income-eligible residents could qualify for a rebate of up to $7,500. To claim the rebate, you need to submit an application no longer than six months after buying the vehicle.

Maine

Through the Efficiency Maine program, state residents can receive a rebate of up to $7,500 for purchasing a battery electric vehicle or plug-in hybrid electric vehicle. You can either buy the car from a participating dealership, which will automatically reduce the price, or purchase directly from the manufacturer and later submit an application. The vehicle must be new, though income-eligible drivers may purchase a qualifying used electric vehicle.

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Electric vehicle incentives FAQs

Here are answers to some commonly asked questions about electric vehicle tax and rebate incentives.

How do you claim your 2023 EV tax credit?
Federal EV tax credits are available to people who buy a new plug-in electric vehicle or fuel cell vehicle from a qualified manufacturer.^[4] Starting in tax year 2023, the credit is worth up to $7,500 for new EVs and up to $4,000 — limited to 30% of the sale price — for used EVs. You need to meet income requirements to qualify. Married couples filing jointly may earn up to $300,000 per year, heads of households can earn up to $225,000 per year, and all other tax filers can earn up to $150,000 annually for eligibility.
What states have the most EV incentives?
California, Vermont, Connecticut, Oregon, and Maine all offer rebates of $7,500 or more when you buy or lease a qualifying electric vehicle and follow program requirements. Depending on the program, the car may be new or used.
Does Florida offer incentives for electric cars?
Florida doesn’t have incentives for private residents buying an electric car, but several local utility companies offer bill credits or discounted rates to residential customers who charge their electric vehicles during off-peak hours and small rebates for buying electric vehicles.^[5]
How do tax incentives work for electric cars?
To claim the federal tax credit, you need to include Form 8936 when you file your federal income tax return. This form also helps you determine your eligibility for federal tax credits.
Which state has the most electric cars?
As of the end of 2021, California was the state with the most electric vehicles in the U.S., with 39% of EVs nationwide.^[6] Florida has the second-highest count of EVs, followed by Texas.

Sources

U.S. Department of Energy. "Federal Tax Credits for New All-Electric and Plug-in Hybrid Vehicles Purchased before 2023." Accessed March 1, 2023
Internal Revenue Service. "Credits and Deductions Under the Inflation Reduction Act of 2022." Accessed March 1, 2023
National Conference of State Legislatures. "State Policies Promoting Hybrid and Electric Vehicles." Accessed March 1, 2023
Internal Revenue Service. "Credits for New Clean Vehicles Purchased in 2023 or After." Accessed March 1, 2023
Alternative Fuels Data Center. "Florida Laws and Incentives." Accessed March 1, 2023
Alternative Fuels Data Center. "Electric Vehicle Registrations by State." Accessed March 1, 2023

Kim Porter

Kim Porter is a writer and editor who's been creating personal finance content since 2010. Before transitioning to full-time freelance writing in 2018, Kim was the chief copy editor at Bankrate, a managing editor at Macmillan, and co-author of the personal finance book "Future Millionaires' Guidebook." Her work has appeared in AARP's print magazine and on sites such as U.S. News & World Report, Fortune, NextAdvisor, Credit Karma, and more. Kim loves to bake and exercise in her free time, and she plans to run a half marathon on each continent.

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Courtney MikulskiSenior Editor, Auto

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Electric Vehicle Incentives by State (2023)

Electric cars are not just good for the environment. Buying one can put some extra cash in your pocket via tax credits or rebates.

Table of contents

Electric vehicle definitions

Compare Electric Vehicle Insurance

Hybrid and electric vehicle incentives by state

States with the best EV incentives

California

Vermont

Connecticut

Oregon

Maine

Compare Electric Vehicle Insurance

Electric vehicle incentives FAQs

How do you claim your 2023 EV tax credit?

What states have the most EV incentives?

Does Florida offer incentives for electric cars?

How do tax incentives work for electric cars?

Which state has the most electric cars?

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