The federal EV tax credit ($7,500 new/$4,000 used) expires for vehicles acquired or placed in service after September 30, 2025, due to new legislation. This will likely result in higher effective costs for buyers, a potential slowdown in short-term EV sales, and increased pressure on manufacturers to offer, rebates or incentives to maintain demand.
As of September 30, 2025, the federal EV credits have expired. No new credits will be paid out at the time of sale. If you have purchased a qualifying EV but are not in possession of it yet, you may still be eligible. Qualifying sales require a signed agreement and a down payment prior to September 30, 2025.
While new EVs are likely to see their transaction prices increase due to the loss of the credit, used-EV prices (which have been declining steadily thanks to high inventory and a plethora of affordable models under $25,000) are selling quickly, too, according to Cars.com data.
Yes, but only for vehicles acquired and placed in service by September 30, 2025, due to the "One Big Beautiful Bill" (OBBB) (OBBB) legislation, which ends the federal Clean Vehicle Credits for new, used, and commercial EVs after that date. To claim the credit, you must enter a binding contract and make a payment by the deadline, with potential for delivery and claiming in 2026.
Update: The New Clean Vehicle Credit is not available for vehicles acquired after Sept. 30, 2025. The vehicle must be placed in service for you to claim the credit.
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.
Reconfirmation of the commitment to end the sale of new purely ICE cars by 2030, with all new cars and vans being fully zero emission by 2035. A technology definition to permit the sale of hybrid electric vehicles ( HEVs ) and plug-in hybrid vehicles ( PHEVs ) post-2030, alongside zero emission vehicles ( ZEVs ).
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.
Pre-owned EVs are a bargain right now and could stay that way for the next couple of years. That's especially true when compared to the new car market. In general, new EVs cost more than comparable gasoline-powered vehicles because of the high cost of their batteries.
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.
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.
"Even when the tax incentive goes away, used electric vehicles will likely still cost much less than similar gas-powered vehicles. Because EV technology is developing so quickly, depreciation on used EVs is still high."
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.
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.
If you don't file your tax return by the October 15 extension deadline, the IRS charges a failure-to-file penalty of 5% per month (up to 25%) on unpaid taxes, plus a failure-to-pay penalty (0.5% per month), and interest on the total amount due, potentially leading to significant costs, though you can request penalty abatement for reasonable cause, and if you're owed a refund, you generally won't face penalties but risk losing your refund if you wait too long (usually over 3 years).
At a glance:
Any gifts exceeding $19,000 in a year must be reported and contribute to your lifetime exclusion amount. You can gift up to $13.99 million over your lifetime without paying a gift tax on it (as of 2025).
The IRS primarily learns about large gifts when you file Form 709, the Gift Tax Return, for amounts exceeding the annual exclusion (e.g., $19,000 per person in 2025). They can also discover gifts through third-party reporting (banks reporting large cash transfers), audits of your estate, or by matching transactions to public records, especially for significant asset transfers like property, which might trigger property tax reassessments.