IRS adds vehicles to qualified plug-in vehicle list


Authored by RSM US LLP

The IRS recently added vehicles to its list of eligible vehicles for the section 30D credit for qualified plug-in electric drive motor vehicles. The new vehicles eligible for the credit are the 2021 Ford Escape Plug-in Hybrid,the 2021 Porsche Taycan models 4S EV, Turbo EV and Turbo S EV, and the 2021 Kia NIRO EV. (For a full list of eligible vehicles, refer to Qualified Plug-In Electric Drive Motor Vehicles (IRC 30D).)

Section 30D allows for a credit for qualified plug-in electric drive motor vehicles, including passenger vehicles and light trucks, for the taxable year in which it is placed in service. For vehicles acquired after Dec. 31, 2009, the credit is equal to the base amount of $2,500 plus, for vehicles that draw propulsion energy from a battery with at least five kilowatt hours of capacity, $417, plus an additional $417 for each kilowatt hour of battery capacity in excess of five kilowatt hours. The maximum amount of the credit allowed for a vehicle is $7,500. The credit begins to phase out for vehicles when 200,000 qualifying vehicles manufactured by that manufacturer have been sold for use in the United States. 

The newly added vehicles are eligible for a credit of $6,843 for the Ford,$7,500 for the Porsche and $7,500 for the Kia.

Taxpayers who have questions on how these credits apply and other rules for claiming the credit should consult their tax advisers.