And certain cars may not qualify based on price. Sedans with a retail price of more than $55,000 aren’t eligible, nor are vans, SUVs or trucks over $80,000.
Two other rules apply to manufacturing: One carries requirements for sourcing of the car battery’s critical minerals; the second requires a share of battery components be manufactured and assembled in North America. Consumers lose half the tax credit’s value — up to $3,750 — if one of those requirements isn’t met; they’d lose the full $7,500 for failing to meet both.
The five requirements were added by the Inflation Reduction Act, and none of them apply to the commercial clean vehicle credit, Schmoll said.
A tax credit for entrepreneurs who buy new electric vehicles or machinery doesn’t carry many of the same restrictions that apply to consumers buying clean cars.