Prospective car buyers looking at electric vehicles are being advised to act quickly to take advantage of a potential Biden-era EV tax credit worth up to $7,500, as it may be axed by President-elect Trump and Republicans in tax negotiations next year. The credit offers federal tax breaks through 2032 for consumers buying or leasing new or used EVs, with credits ranging from $4,000 to $7,500. Trump’s team aims to eliminate the credit as part of a broader tax cut package. Uncertainty exists over the fate of the credit in future Republican tax bills, with estimates indicating it could save $921 billion by repealing the green energy tax credits.
Buyers who qualify for the credit are rushing to purchase EVs before it potentially disappears, with some dealers seeing increased demand. Consumers are encouraged to take advantage of the credit while it is still available, either as a point-of-sale discount or through lease agreements. However, buyers should review lease terms to ensure they are not at risk of increased payments if the credit is denied. It is expected that Republicans will pass a tax package by the end of 2025 that may phase out the federal EV credit in 2026 or 2027. Overall, the advice is to act quickly and take advantage of the known entity of the EV tax credit before it potentially goes away.
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