U.S. Department of Energy - Energy Efficiency and Renewable Energy

Vehicle Technologies Office

Fact #683: July 11, 2011
Federal Tax Credits for the Purchase of Advanced Technology Vehicles

The Federal Government has encouraged the use of different transportation fuels by allowing tax credits on vehicle purchases. The purchase of a traditional (non-plug-in) hybrid vehicle was eligible for a tax credit of up to $3,400 from 2005 through 2010. Diesels, which are more efficient than gasoline vehicles, were eligible for a similar tax credit, as were alternative-fuel vehicles. All of those credits were discontinued at the end of calendar year 2010. Now, electric vehicles and plug-in hybrid-electric vehicles are the only ones for which a tax credit is available – up to $7,500. To find out more about these tax credits, go to the IRS website, or FuelEconomy.Gov.

Federal Government Tax Incentives for Advanced Technology Vehicles

Vehicle Type	Calendar Year in which the Vehicle was Purchased	Maximum Credit Amount	Vehicles Currently Eligible for a Tax Credit
Plug-in Hybrid-Electric Vehicles	2010 - on*	$7,500		2011 Chevrolet Volt
Electric Vehicles	2009 - on*#	$7,500		2010 Coda Sedan
				2011 Nissan Leaf
				2011 Smart For Two
				2008-2010 Tesla Roadster
				2011 Wheego LiFe
Hybrids	2005 - 2010	$3,400	Purchases made after December 31, 2010 are not eligible for the tax credit.
Diesels	2005 - 2010	$3,400
Compressed Natural Gas	2005 - 2010	$3,400
Liquefied Natural Gas	2005 - 2010	$3,400
Liquefied Petroleum Gas	2005 - 2010	$3,400
Hydrogen	2005 - 2010	$3,400
M85 (85% Methanol)	2005 - 2010	$3,400
Source: U.S. Department of Energy and U.S. Environmental Protection Agency, www.fueleconomy.gov website, June 2011. * Phase-out of this tax credit is determined by the number of vehicles produced. # Requirements for this credit changed between 2009 and 2010.

Return to 2011 Facts of the Week