Sign In or Create an Account.

By continuing, you agree to the Terms of Service and acknowledge our Privacy Policy

Electric Vehicles

Get Your EV Tax Credit While It’s Still Functional

Here’s one federal climate program that’s still working — for now.

•
A Ford dealership.
Heatmap Illustration/Getty Images

The first two weeks of the Trump administration have been chaotic for the clean energy industry, to say the least. Offshore wind permitting is on hold and state governments are canceling plans to sign new contracts. Trump’s federal funding freeze was on, then off-but-actually-still-on, and then technically off again. Despite a court injunction on the pause, many grant recipients still seem to be locked out of their funding portals.

But one climate initiative that’s also one of the president’s biggest bugbears has escaped his meddling thus far: The federal tax credit for electric vehicles is still functioning normally.

Former President Joe Biden’s Inflation Reduction Act created a tax credit of up to $7,500 for new electric vehicles and $4,000 for used vehicles. As of January of this year, about 16 EV and plug-in hybrid models were eligible for the new vehicle credit, which is limited to models that are assembled in North America and meet certain battery sourcing requirements. A loophole in the rules also allows dealers to apply the tax credit to any electric vehicle lease, meaning dealers can offer lessees a discount on a much wider range of options.

Trump attacked the subsidy on the campaign trail, and his transition team was reportedly planning to kill it. One of his first executive orders took aim at a number of electric vehicle-related programs, ordering the Environmental Protection Agency to revoke waivers that allow California and other states to pass stronger emissions standards for vehicles than the federal government’s. His funding review and freeze specifically called out the National Electric Vehicle Infrastructure Formula Program, a $5 billion program to fund EV charging infrastructure. But even though EV charger grantees couldn’t access their funding, car dealerships around the country did not have any trouble getting into the Internal Revenue Service’s portal to log their electric vehicle sales and file for reimbursement for the tax credit.

When someone purchases an eligible electric vehicle, the buyer can either claim the tax credit on their own tax return or they can “transfer” it to their dealership, allowing the dealer to take the credit amount off the sale price. Dealers can then file for a direct reimbursement from the Internal Revenue Service.

I reached out to the National Automobile Dealers Association, which represents new car dealers, to ask if they had heard from any of their members about issues with the advanced payment program for the EV tax credit. “We checked into this earlier in the week, both on the dealer end and with Treasury,” Jared Allen, the vice president for public affairs told me on Friday. “Nothing has changed with the availability of advanced payments to dealers for EV tax credits.”

The president does not have the authority to end the EV tax credit program on his own — changes would have to come through Congress. Before Trump’s inauguration, Republicans on the House Budget Committee circulated a long list of potential cost-cutting measures that included eliminating many Inflation Reduction Act programs. One menu item recommended cutting all clean energy tax credits, but a separate proposal explicitly suggested keeping the EV tax credit and closing the leasing loophole. The Committee is aiming to present a first draft of a budget reconciliation bill by the end of this week, according to E&E News, at which point we’ll see what made the cut.

Green

You’re out of free articles.

Subscribe to access Heatmap's exclusive climate and energy polling, award-winning journalism, and subscriber-only events, now just $99 $79.20/year.
To continue reading
Create a free account or sign in to unlock more free articles.
or
Please enter an email address
By continuing, you agree to the Terms of Service and acknowledge our Privacy Policy
AM Briefing

Trench Wire

On a NYC green bank, Meta’s clean cement, and antimony

Trench group machinery.
Heatmap Illustration/Trench Group

Current conditions: A Pineapple Express — the powerful atmospheric river that hits the West Coast, not the marijuana strain — could pummel the Southwest with heavy rain on Halloween • The remnants of Typhoon Champi are driving a severe storm in the Bering Sea, with four-foot waves lapping on Alaska’s shore • Despite India’s evacuation of nearly 200,000 people, Cyclone Arnab killed at least nine and destroyed tens of thousands of acres of crops in Andhra Pradesh.


THE TOP FIVE

1. The Fed holds rates steady

The Federal Reserve voted Wednesday to keep benchmark interest rates steady despite last month’s spike in inflation statistics. In a post-meeting statement, the Federal Open Market Committee said it had decided to keep the federal funds target range between 3.75% and 4%, maintaining the central bank’s quarter percentage-point hike from last month. “Inflation remains elevated,” the statement cautioned. “The accumulation of more information will help the Committee determine the policy stance appropriate to ensure a timely return of inflation to the Committee’s 2% goal.”

Keep reading...Show less
Blue
Power lines.
Heatmap Illustration/Getty Images

This transcript has been automatically generated.

Subscribe to “Shift Key” and find this episode on Apple Podcasts, Spotify, Amazon, YouTube, or wherever you get your podcasts.

Keep reading...Show less
Yellow
Podcast

Why Permitting Reform Is a Historic Victory Over Utilities

Rob talks with David Pomerantz, the executive director of the Energy and Policy Institute, about how the bill would remake the electricity grid — and strike against utilities’ political power.

Power lines.
Heatmap Illustration/Getty Images

Climate and environmental advocates are sharply divided over the Senate’s bipartisan permitting reform proposal. But what most people agree is that the bill’s changes to electricity and transmission law are really, really good — and in some sense are much better than expected.

Because of how the media works, that means nobody has talked about these proposals very much. So on this show, we wanted to focus on the part of the Bipartisan American Affordability and Jobs Act that has gotten rave reviews.

Keep reading...Show less
Yellow