ou may have heard about the new federal tax credit for buying a new electric vehicle (EV). It reauthorizes the $7,500 federal tax credit to 2032 with some new and complex rules.
Things like where the battery and car are manufactured, what it costs, etc., are factored in. To simplify things, we have shortlisted all the new cars from popular car manufacturers like Tesla, Ford, Rivian, Nissan, and more that qualify for this federal tax credit.
Tesla – Model 3 & Model Y
If you want the federal tax credit on these Tesla models, you’ll have to wait until the new year because that’s when Tesla re-enters the new program. There will be a $55,000 price cap on the Model 3 because it falls in the ‘car’ category.
On the other hand, the Model Y has a higher ceiling of $80,000 because it falls in the ‘utility vehicle’ category. This means there is enough room for you to get most options with these Teslas, except the self-driving technology, which is a $15,000 option.
Ford – Mustang Mach-E & F-150 Lightning
The Mustang Mach-E has been a hit among Ford and EV enthusiasts. However, an upgrade to its batteries is coming next year. So, it might be wise to wait for a little. If you can wait longer, the 2026 model comes with a significant redesign.
On the other hand, the Ford F-150 Lightning is also a huge hit, especially considering that there are no other full-sized EV pickups on the market right now. You can also easily keep its total price under the $80,000 price cap for trucks and utility vehicles to qualify for the federal tax credit.
Rivian – R1S & R1T
Rivian’s trucks have been massively hyped for their impressive practicality. However, you may find it difficult to get the base model under the $80,000 price cap. There was also a recent recall to adjust the steering fastener in 80 percent of their fleet, but it isn’t too concerning.
Nissan – Leaf
Nissan has developed a good EV with the Leaf, but it isn’t as exciting as some other EVs on this list. The model may get discontinued in the US by 2026, so consider getting one before that.
Volkswagen – ID.4
The new ID.4 from Volkswagen is categorized as a small SUV, giving it a high price ceiling of $80,000, enough to buy 2 of these. However, you will have to be careful because the federal tax credit only applies to EVs manufactured in North America.
This means you’ll have to avoid the ones made in Germany and opt for the ones that have recently started rolling out from the new Tennessee plant.
The new federal tax credit can save you a significant amount of money on the purchase of a new EV. Consider the mentioned cars, but make sure you do not cross the price cap of the federal tax credit with options.