If you are planning to buy an electric vehicle (EV), lawyers and EV experts urge you to make the purchase before 2024 ends to avoid the risks of missing out on up to $7,500 in EV tax credits as they fear President-elect Donald Trump will scrap the mandate in tax negotiations upon assuming Office next year. The Inflation Reduction Act implemented by President Joe Biden in 2022 offered federal EV tax benefits through 2032 for individuals who purchase or lease new or used EVs, including plug-in hybrid electric vehicles. For used EVs, the tax credit limit was set to $4,000 and goes up to $7,500 for new ones. The biggest advantage of the mandate is that consumers can access the savings before tax season, as the provision enables dealers to pay the funds upfront during purchase.
"There's no question there's real risk in the EV credit going away" next year, said Jamie Wickett of Hogan Lovells, specialising in federal tax policy, energy and the environment. "If you're a consumer in the market for an EV, I would without a doubt push that into 2024, if at all possible — whether an outright purchase or a lease — just to reduce the risk of the credit going away," Wickett added.
