Yes, the federal $7,500 new and $4,000 used EV tax credits effectively ended for vehicles acquired after September 30, 2025. As of late 2025/2026, these incentives are no longer available for new purchases. Some state-level incentives, such as those in California, may still be available to consumers.
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.
The One Big Beautiful Bill Act (OBBBA) made several updates to tax benefits related to car buyers. 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.
What Happens to the EV Market Now That the Federal Tax Credit Is Gone? Key takeaway: With the expiration of the federal tax credit, automakers are reevaluating their pricing, production and future models, and future incentives will depend on inventory levels.
The new tax bill will end the $7500 tax credit on new EVs and the $4000 tax credit on used EVs.
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.
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.
EV sales shrank significantly in Q4. But not every model suffered. Electric vehicle sales in the U.S. fell 36% year-over-year in the fourth quarter of last year. Many of those Q4 purchases happened in Q3 due to the end of the tax credits.
In 2019, when a previous version of the EV tax credit was phased out for Tesla and General Motors because both hit a prescribed sales target, those two automakers responded by cutting prices. EV sales have been growing steadily for years, and at a much faster pace than traditional gas-powered cars.
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.
But the end is in sight, as the government has declared that sales of petrol and diesel cars will end in 2030. Some car industry observers think this is ambitious, but either way, in a few years, there won't be many diesel cars on sale. They will survive beyond that, but by 2050, they could well be a rarity.
You won't be forced to buy an electric car (EV) overnight, but government regulations (like the EPA's emissions rules) and state mandates (like California's 2035 ban on new gas car sales) are pushing automakers to sell more EVs, effectively making them the primary new vehicle option in many places by the 2030s, though this is subject to political and industry changes, with debates ongoing about consumer choice and affordability.
Yes, there will likely still be gasoline (gas) cars on the road in 2050, though they will be far outnumbered by electric vehicles (EVs) in new sales, with some projections showing EVs making up the majority of new purchases by then, while gas cars remain a significant portion of the total cars on the road due to their long lifespan. Government incentives and mandates, like California's goal to phase out new gas car sales by 2035, aim to accelerate the transition, but the existing fleet and consumer adoption rates mean gas cars won't disappear overnight.
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.
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 the September 2025.
To avoid the 22% tax bracket (or any higher bracket), focus on reducing your taxable income through strategies like maxing out 401(k)s and HSAs, deferring bonuses, tax-loss harvesting, smart charitable giving, and strategic asset location, understanding that higher rates only apply to income within that bracket, not your entire income.
Yes, in 2024, each parent could gift $18,000 to a child (totaling $36,000 per child for the couple) without tax implications, and for 2025, that amount increased to $19,000 per parent ($38,000 per child) because the annual gift tax exclusion is adjusted for inflation, requiring separate checks for each parent to utilize the full amount, according to TurboTax, Yahoo Finance, Guardian Life, IRS (.gov), and Mercer Advisors.