While many will welcome the long-awaited tax reform recently championed by President Trump, it could prove to be a nail biter for electric-vehicle shoppers and enthusiasts. That?s because many buyers of electric vehicles, including relatively affordable ones like the Nissan Leaf or the Chevrolet Bolt EV, as well as some buyers of plug-in hybrids, could be losing the tax credit of up to $7500 they currently get under the federal Plug-In Electric Drive Vehicle Credit.
Those who buy an EV or a plug-in hybrid are getting a highly sweetened deal on the technology. The federal government has in recent years ramped up subsidies on electrified powertrain costs, from the battery technology to the charging infrastructure and from their development to sales. It?s on the sales side where the tax credit is a great asset, perhaps most in terms of allowing for affordable (in some cases very affordable) leases. The credit, according to some analysts and industry insiders, also helps level the playing field at a time when electrified powertrains are required by regulation but more expensive to build than conventional vehicles. Even with Tesla CEO Elon Musk and General Motors CEO Mary Barra serving on a presidential advisory forum, it?s likely that neither the latest administration nor Congress are going to be as EV friendly as in the past.
How It Works
The credit works like this: You must buy an electric vehicle or a plug-in hybrid for your own personal use (the credit is factored...