Individuals do not qualify for the $7,500 new EV tax credit if their modified adjusted gross income (MAGI) exceeds $300,000 for married couples, $225,000 for heads of households, or $150,000 for single filers. Other disqualifiers include buying a used EV, purchasing a car with a high MSRP ($55k+ for sedans, $80k+ for SUVs/trucks), or selecting a vehicle not assembled in North America.
To qualify for a tax credit of up to $7,500, a new EV or an eligible plug-in hybrid electric vehicle (PHEV) must have met certain rules: A vehicle's MSRP must not have exceeded certain limits, so pricey EVs like the GMC Hummer EV, Lucid Air, and Tesla Model S didn't qualify.
Without a qualifying child. Recently divorced, unemployed or experienced other changes to their marital, financial or parental status. Below the filing requirement with earnings.
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Update: The New Clean Vehicle Credit, Previously-Owned Clean Vehicle Credit, and Qualified Commercial Clean Vehicle Credit are not available for vehicles acquired after Sept. 30, 2025. The vehicle must be placed in service for you to claim the credit.
Taxpayer income
The taxpayer's modified adjusted gross income for either the current or prior year must be $300,000 or less for joint filers and surviving spouses, $225,000 or less for head of household filers, or $150,000 or less for other filers.
For the 2024 tax year, to qualify for the EITC, you must: File a federal income tax return. Have earned income under $66,819.
Providing an incorrect bank account number is a common reason for the delay. Ensure the bank account number entered in your tax return is accurate. The IT Department mandates the pre-validation of your bank account to ensure that the refund is credited to the correct account.
You need to be using the vehicles for your use and there is no minimum ownership period requirement. Adding onto what TurtleBoy said, you can claim a theoretical unlimited number of $7500 federal EV credits, as long as you have a corresponding tax liability since the EV credit is non-refundable.
To qualify for the credit, you must enter into a binding written purchase agreement and make a car payment on or before September 30, 2025. You should claim the credit on your 2025 tax return filed in 2026. The EV tax credit is non-refundable, so you won't get a refund for the unused portion of it.
EV tax credit income limits for new and used EVs
You don't qualify for the EV tax credit if you're single and your modified adjusted gross income exceeds $150,000. The EV tax credit income limit for married couples filing jointly is $300,000.
According to the IRS, qualifying EVs must undergo final assembly in North America. Currently, Toyota has just one all-electric vehicle, the Toyota bZ4X, which is assembled in Japan. However, you may still be eligible for a Toyota EV tax credit if you lease a new bZ4X instead of purchasing it.
Older Americans may qualify for a new $6,000 IRS tax deduction in 2026. The benefit targets seniors facing rising healthcare, grocery, and housing costs. Eligible taxpayers aged 65 and older could save up to $1,320. Income limits apply.
One-time forgiveness, officially known as First-Time Penalty Abatement (FTA), is an IRS program that allows qualified taxpayers to have certain penalties removed from their tax accounts.
The IRS tries to audit tax returns as soon as possible after they are filed. Accordingly, most audits will be of returns filed within the last two years. If an audit is not resolved, we may request extending the statute of limitations for assessment tax.
The most common reasons people don't qualify for the Earned Income Tax Credit, or EIC, are as follows: Their AGI, earned income, or investment income is too high. They have no earned income. They're Married Filing Separately.
The eligible vehicles are:
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