The Treasury Department and Internal Revenue Service (IRS) have released new guidelines on how consumers can access federal tax credits for electric vehicles (EVs) under the Inflation Reduction Act of 2022. This move aims to boost EV sales by allowing consumers who purchase EVs to transfer their new clean vehicle credit of up to $7,500 or their previously owned clean vehicle credit of up to $4,000 directly to car dealers beginning January 1, 2023.
This change provides buyers with an immediate down payment for their EV, eliminating the need to wait until the following year to receive the credit on their tax return. To qualify, consumers must purchase their EV from a dealer registered with the new IRS website, Energy Credits Online. When the buyer transfers the credit, the dealer will either reduce the vehicle's price or provide cash in the eligible amount.
Lauren Blatchford, chief implementation officer for the Inflation Reduction Act, emphasized that this change will enable consumers to reduce upfront costs for an EV, expand their choices, and assist auto dealers in growing their businesses. The Treasury Department welcomes public comments and will consider them before issuing final rules.