The Inflation Reduction Act, enacted in August 2022, significantly changed the qualifications for and calculation of the tax credit available for the purchase of an alternative fuel vehicle (electric and fuel cell vehicles). The Act created the Clean Vehicle Credit with one provision effective upon enactment and the remaining provisions phased in beginning in 2023. As a result of enactment, many vehicles that previously qualified for the credit earlier in 2022 no longer qualify and fewer vehicles will qualify for the full credit after April 18, 2023. Significant changes and their effective dates are discussed below.
The IRS has updated its FAQ sheet to reflect guidance issued in 2023.
The Department of Energy has compiled a list of eligible vehicles based on their delivery dates as the eligibility requirements changed for pre and post-Aug 17, 2022 and pre and post-April 18, 2023 deliveries: Department of Energy – Tax Incentives