Before the calendar switched over to 2024, the list of electric vehicles (EVs) and plug-in hybrid vehicles (PHEVs) eligible for a tax credit of up to $7,500 from the federal government was 43 entries long. Today, it’s 19. Only 10 now qualify for the full discount. Nine get just half.
But don’t let the headlines convince you that a model that fell off the list is off for all of 2024. Cars could appear and disappear from the list regularly throughout the year. A car that doesn’t qualify today might qualify by the time you’re shopping for it.
Government Requirements Grew More Strict
In most cases, automakers haven’t made changes to the cars. They lost tax credits because the law changed.
The portion of 2022’s Inflation Reduction Act that controls the tax credits was written to help develop new supply chains for critical battery minerals that, today, often come from China. It includes two sets of requirements that grow stricter most years.
The tax credit has two parts.
Last year, automakers had to build at least 50% of the car’s battery in North America for it to qualify for a $3,750 tax rebate.
This year, that same requirement changed to 60%.
EV batteries use certain critical minerals. Some are rare. Others are common in geology but not traditionally mined in the quantities America will need to power millions of EVs.
To qualify for a second $3,750 rebate in 2023, automakers had to build an EVs battery with at least 40% of its minerals mined in the U.S., or a country with which the U.S. has a free trade agreement.
This year, that requirement jumped to 50%.
Cars That Lose Eligibility Could Regain It at Any Time
A car that isn’t on the list today could reappear anytime.
Automakers are working to obtain critical minerals like lithium and cobalt from new sources in order to qualify. If a company works out new supply contracts, a car left off the list today could appear on it tomorrow. We expect the list to change frequently during the year.
Sale Date, Not Model Year, Matters
Many dealerships have some leftover 2023 models sitting on the lot right now. But they don’t qualify under the 2023 rules. Only the sale date controls which set of restrictions apply, so the new 2024 rules apply to every EV for sale today, regardless of when it was built.
You Can Still Qualify When Leasing
Many cars that don’t qualify when purchased still qualify for the $7,500 credit when leased. The IRS lets leased EVs qualify for the full credit no matter where the car is built, or where its battery comes from.
You Can Use Your Rebate as a Down Payment
While shoppers lost out on the credit for many new EVs on Jan. 1, they gained a new right that could entice many.
In 2023, buyers had to claim the tax credit on their taxes. That required them to have the money up front or borrow it and then claim the rebate the next time they filed taxes.
Beginning Jan. 1, that changed. Buyers can now use the credit instantly as a down payment. The federal government will transfer the credit to the dealership instead of waiting for the buyer to claim it. Note that vehicle price caps still apply: $55,000 or less for cars and $80,000 for SUVs and trucks.
List of Currently Qualifying EVs:
| Make | Model | Tax Rebate Amount Today |
| Chevrolet | Bolt EV | $7,500 |
| Chevrolet | Bolt EUV | $7,500 |
| Chrysler | Pacifica Plug-in Hybrid (PHEV) | $7,500 |
| Ford | Escape PHEV | $3,750 |
| Ford | F-150 Lightning (extended-range battery) | $7,500 |
| Ford | F-150 Lightning (standard-range battery) | $7,500 |
| Jeep | Grand Cherokee 4xe PHEV | $3,750 |
| Jeep | Wrangler 4xe PHEV | $3,750 |
| Lincoln | Corsair Grand Touring PHEV | $3,750 |
| Rivian | R1S Dual-Motor Large Battery | $3,750 |
| Rivian | R1S Quad-Motor Large Battery | $3,750 |
| Rivian | R1T Dual-Motor Large Battery | $3,750 |
| Rivian | R1T Dual-Motor Max Battery | $3,750 |
| Rivian | R1T Quad-Motor Large Battery | $3,750 |
| Tesla | Model 3 Performance | $7,500 |
| Tesla | Model X Long Range | $7,500 |
| Tesla | Model Y All-Wheel Drive | $7,500 |
| Tesla | Model Y Performance | $7,500 |
| Tesla | Model Y Rear-Wheel Drive | $7,500 |
