If you're shopping for an EV in 2026 expecting a $7,500 discount, stop and check this first. The federal EV tax credit that ran from 2023 through most of 2025 no longer exists for new purchases — it was eliminated ahead of schedule, and a lot of outdated articles, dealer marketing, and forum posts still don't reflect that. Here's exactly what changed, the one narrow exception, and what's genuinely still available.
Quick answer: The $7,500 new-EV credit, the $4,000 used-EV credit, and the "lease loophole" that let leasing companies pass through a similar discount all ended for vehicles acquired after September 30, 2025, under the One Big Beautiful Bill Act (OBBBA). There is no federal purchase credit for 2026 EV buyers, with one narrow exception below. A separate, smaller car-loan interest deduction and a home-charger credit (expiring soon) are what's left.
The Inflation Reduction Act of 2022 created the Clean Vehicle Credit (Section 30D, up to $7,500 for new EVs), the Previously-Owned Clean Vehicle Credit (Section 25E, up to $4,000 for used EVs), and the Qualified Commercial Clean Vehicle Credit (Section 45W), and scheduled all three to run through 2032. The One Big Beautiful Bill Act, signed into law on July 4, 2025, moved up the expiration date dramatically. Per the IRS's own guidance: none of these three credits are available for vehicles acquired after September 30, 2025 — regardless of the vehicle, your income, or where it was assembled.
This wasn't a gradual phase-out. It was a hard stop: buyers who took delivery on September 30 could still claim the credit; buyers who took delivery on October 1 could not, all else being equal.
You may still be able to claim the old credit on your 2025 tax return (filed in 2026) if both of the following are true:
If both apply, you file IRS Form 8936 with your 2025 return, even if the vehicle was actually delivered after the deadline. If you're not sure whether your situation qualifies, this is worth a few minutes with a tax preparer — the exception is real, but the paperwork requirements are specific.
Before the change, many EV shoppers leased specifically to capture a version of the credit that buying couldn't get. Leased vehicles are classified as commercial vehicles, so leasing companies could claim the $7,500 Commercial Clean Vehicle Credit (Section 45W) — which had none of the income limits, price caps, or North American assembly requirements that applied to the consumer purchase credit — and pass some or all of it along as a lease cash discount. This is why EV lease shares climbed sharply through 2024 and 2025.
The OBBBA shut down this route on the same September 30, 2025 date as the purchase credits. If you're comparing an EV lease against a purchase in 2026, don't assume the old "$7,500 off a lease" trick still applies — check the specific deal in front of you rather than what leasing used to offer. See our EV lease vs buy breakdown for how this changes that decision.
A new car-loan interest deduction (not EV-specific). Also created by the OBBBA, this lets taxpayers deduct up to $10,000 per year in interest paid on a loan for a new personal vehicle that underwent final assembly in the United States — gas, hybrid, or electric, it doesn't matter, as long as the vehicle qualifies. It applies to tax years 2025 through 2028, doesn't require itemizing, and is claimed on Schedule 1-A. It phases out for higher earners (roughly above $100,000 MAGI for single filers and $200,000 for joint filers). It's a real deduction, but it's a fraction of what the old EV purchase credit was worth for most buyers — typically a few hundred to low four figures in tax savings, depending on your loan and bracket, versus a flat $7,500 reduction in price.
Home EV charger credit (Section 30C) — but the window has now closed too. This credit covered 30% of the cost to buy and install a home Level 2 charger, up to $1,000, for chargers placed in service in an eligible census tract. It expired for equipment placed in service after June 30, 2026 — a deadline that has now passed. If your charger was installed and operational on or before that date, you can still claim it on your 2026 return with IRS Form 8911. If you haven't installed one yet, this incentive is no longer on the table.
State and utility incentives. These run independently of federal rules and several remain active — California, Colorado, and New York, among others, have historically offered their own EV rebates or tax credits, and utilities in many territories still offer charger rebates. Programs and amounts change often, so check your state's current program and your utility's site directly rather than relying on last year's numbers.
Automaker-funded incentives. Since the federal credit disappeared, several automakers and their captive lenders have leaned harder on their own cash discounts, subsidized financing, or included charging packages to keep EVs competitive — these come and go by model and quarter, so compare the actual deal on the specific vehicle you're considering rather than assuming a manufacturer incentive replaces what the federal credit used to provide.
Compare total ownership cost with today's numbers — not the pre-October-2025 assumptions.
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