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A recently expired tax break for electric vehicle (EV) chargers has been given new life under the recently passed Cut Inflation Act, a measure that will give taxpayers up to $1,000 in tax credits. tax.
The Section 30C tax credit, officially known as the real estate credit for refueling alternative fuel vehicles, has been extended for ten years and will expire on December 31, 2032.
The revived credit is almost the same as the previous version which allows taxpayers to claim up to $1,000 for EV charger hardware and installation, with a few key changes.
You can get credit for your home EV charger
Taxpayers are eligible for a credit of 30% of the material and installation costs of EV chargers installed in your home after December 31, 2021. This is a one-time, non-refundable tax credit of one maximum of $1,000.
Residential EV chargers can cost anywhere from $200 to well over $1,000, depending on charger type and brand. Hiring an electrician to install the charger can cost between $300 and $1,000, depending on the charger, the voltage and the work to be done.
Some people may need to update their electrical panel to accommodate the new charger, which could increase installation costs (covered by the credit). You may also need to obtain a permit to install your feeder, another fee that can increase the price of installation.
IRS Form 8911 can give you an idea of how much you are entitled to as a tax credit. Just be sure to keep your receipts when you file your taxes.
More types of EV chargers may qualify for the credit
The reinstated tax credit for electric vehicle chargers now covers two-way charging equipment, which was not included in the previous credit. This time around, taxpayers can also claim a credit for EV chargers designed for two- and three-wheeled vehicles, such as motorcycles.
Two-way EV chargers charge your car using your home’s electricity, and they can also send your car’s power back to the grid or your home. For example, the Quasar 2 is a two-way charger that can power homes for up to three days. Since they are relatively new to the home market, two-way charging is more expensive than one-way charging, costing upwards of $1,500. The Quasar 2, for example, costs around $4,000.
You can combine state rebates with the federal tax credit for EV chargers
Many states and metropolitan areas offer some sort of incentive to have a residential EV charger. If your state offers an EV charger rebate, you can multiply your savings by getting both the state/metro rebate and claiming the federal tax credit.
The rules differ depending on the program. In Arizona, Tucson Electric Power customers who purchase a Level 2 or DC fast charger can get up to $500 off.
Some states will offer rebates for multiple chargers in a single household, such as the Chugach Electric Association of Alaska’s rebate program that provides $200 bill credits to up to two Tier 2 chargers in a single household.
Check with your local utility provider or local government to find out what EV charger programs are available and what the requirements are.