Yes, the $7,500 federal clean vehicle tax credit for new EVs ended for vehicles acquired after September 30, 2025, following legislation passed in mid-2025, though buyers could still claim it if they had a binding contract by that date and took possession by year-end. While the federal credit is gone, some states like California are introducing their own incentives, and manufacturers may offer other discounts, but the federal program as it was is over for new purchases.
Several of the most popular electric car models experienced steep sales drops in the fourth quarter of 2025, after setting records in the third quarter as car buyers rushed to take advantage of the $7,500 federal tax credit before it expired at the end of September 2025.
The $7,500 federal tax credit are no longer available on new EV purchases, and California will not step in with its own rebate. Buyers weighing whether to make the switch to electric vehicles may find fewer financial reasons to do so, even as charging availability improves.
The federal tax credit of up to $7,500 for qualifying new EVs is set to expire September 30, 2025. Buyers must complete a binding purchase agreement with a down payment before that date.
The federal electric vehicle tax credit (worth up to $7,500 for new EVs and $4,000 for used EVs), is officially ending on September 30, 2025. For more than a decade, these incentives have played a central role in artificially propping up EV sales, coaxing buyers toward electric cars with taxpayer-funded subsidies.
With the passage of the One Big Beautiful Bill in July of 2025, also known as the Working Families Tax Cut, energy tax credits are now set to expire after December 31, 2025.
The tax credit, passed by the Biden administration in 2022 to support EVs, is going away Wednesday as part of President Donald Trump's broad spending and tax bill.
California Gov. Gavin Newsom, a Democrat thought to be likely 2028 presidential contender, announced a plan on Friday, Jan. 9 to spend $200 million in his state's money to offer an "on the hood" electric vehicle tax credit that would offer instant discounts to EVs in the state that is home to most plug-in models in the ...
Premium Increases
As a result, premiums will increase significantly starting on Jan. 1, 2026. What this means is that premium tax credits are still available for 2026, but many people could receive less than they did before.
2026 Earned Income Tax Credit
The maximum credit is $4,427 for one child, $7,316 for two children, and $8,231 for three or more children.
The new tax bill will end the $7500 tax credit on new EVs and the $4000 tax credit on used EVs.
Yes, EVs tend to depreciate more quickly than ICE vehicles, but this gap is closing, and is set to match their depreciation level over time. There are several factors which contribute to this depreciation which will be outlined throughout this guide.
However, a recent AAA survey showed that EV interest in the United States is at its lowest point since 2019—the data showed that only 16 percent of Americans reported being “likely” or “very likely” to purchase an EV as their next car.
Federal electric vehicle (EV) opens in same window tax credits are officially coming to an end. Congress has passed legislation that terminates both the $7,500 tax credit for new EVs and the $4,000 credit for used EVs on September 30, 2025.
If the individual tax cuts expire, taxpayers in all income groups would face higher and more complicated taxes. Machinery and equipment expensing is a key provision that, if allowed to expire, would especially harm capital-intensive industries like manufacturing.
For years, electric vehicles were the privilege of the few—high-tech, high-priced symbols of the future. But that future just hit an economic reset. Across the U.S., Europe and China, a quiet revolution in pricing is underway in which the average cost of an EV is falling faster than at any point in the past decade.
The Electric Vehicle Credit expires on September 30, 2025, meaning purchases made before this date may still qualify for up to $7,500 for new EVs, $4,000 for used EVs, and $40,000 for commercial EVs.
It has now been replaced by Universal Credit or Pension Credit. If you've received a migration notice letter telling you to claim Universal Credit or Pension Credit, read our guide Universal Credit Migration Notice to learn what to do next.
The One, Big, Beautiful Bill Act significantly affects federal taxes, credits and deductions. It was signed into law on July 4, 2025, as Public Law 119-21, and takes effect in 2025.