Proposed Changes to Federal EV Tax Credit – Part 5: Making the Credit Refundable

Refundable Federal EV tax credit-featured image

One of the biggest complaints about the federal electric vehicle (EV) tax credit (IRC 30D) is that its structure of using a non-refundable tax credit is clearly more beneficial to higher-income households. But Congress may actually get something right (well mostly) as among the nine key proposed changes to the tax credit contained in the Clean Energy for America Act (CEAA) is changing the current non-refundable credit into one that is refundable.

Proposed Changes to Federal EV Tax Credit – Part 4: Chinese-Assembled Vehicles Will Not Be Eligible for Tax Credit

No Federal Tax Credit for EVs Assembled in China

One of the proposed changes to the federal EV tax credit that has flown a bit under the radar is also one of the most political and protectionist in nature provisions. Effective January 1, 2022, electric vehicles with final assembly* (see definition at the end) in China would no longer qualify for IRC 30D (federal EV tax credit). 

Proposed Changes to Federal EV Tax Credit – Part 3: MSRP Must Be Less Than $80,000

Should these EVs qualify for the federal EV tax credit?

A provision in the Clean Energy for America Act requires that a new qualified electric vehicle purchased by the taxpayer has a manufacturer’s suggested retail price (MSRP) of $80,000 or less. What would this change mean for automakers and EV buyers?

Proposed Changes to Federal EV Tax Credit – Part 2: End of the Manufacturer Sales Phaseout

Arguably the biggest flaw in the Plug-In Electric Drive Vehicle Credit (IRC 30D) regulations is the triggering of a phaseout schedule of the tax credit when a manufacturer sells 200,000 total EVs (BEV and PHEV). In the Clean Energy Act for America (CEAA) proposed legislation, this per manufacturer threshold would be eliminated and replaced with an industry-wide phaseout based on reaching 50% EV sales share.

Impact of Proposed Changes to the Federal EV Tax Credit – Part 1: Summary Chart

Proposed Changes to IRC 30D Federal EV Tax Credit summary table

There are 9 key proposed changes to the federal electric vehicle (EV) tax credit under the Clean Energy Act for America – this article includes a summary chart and brief highlights.

Fixing the Federal EV Tax Credit Flaws: Redesigning the Vehicle Credit Formula


The federal EV tax credit has a number of flaws, but one of the biggest is the poorly-designed formula that determines the amount of the tax credit available for each BEV and PHEV sold in the US. The formula, which is based on the size of an EV’s battery pack, rewards OEMs (and their buying consumers) for using larger batteries with no consideration to efficiency (EPA range/kWh) and price.

Proposed Federal EV Tax Credit Reform: Will It Move the Sales Needle?


Proposed reform to the Federal EV tax credit extends to automakers who already reached the current phaseout level of 200,000 EVs sold with another 400,000 vehicles, but with a reduction to $7,000 from the current maximum $7,500 credit.

The Federal EV Tax Credit Needs To Be Torn Up (Part 1): What Are The Right Goals?

Ripped paper time to rip up the Federal EV tax credit

The Federal EV tax credit isn’t working: sales of EVs in the US are slowing, are concentrated in one state (California) and brand (Tesla). It is time to tear up and rethink, not tweak the current tax credit.

How The Federal EV Tax Credit Amount is Calculated for Each EV

Have you ever wondered how the IRS determines the credit amount assigned to each EV for the available Federal EV tax credit? And why is it that the Chevrolet Volt, a plug-in hybrid with 53 miles of electric range qualifies for the same $7,500 credit as for a Tesla with over 300 miles of range? […]

Huge Flaws in Federal EV Tax Credit Will Hurt US Automakers Beginning in 2020

Future GM Electric Crossover

The survival of the Federal electric vehicle (EV) tax credit is a good thing for the auto industry and consumers, but several flaws in its design will give EV laggard automakers a significant competitive advantage beginning around 2020. As background, the Federal EV tax credit phases out over 5 quarters beginning the quarter following the […]