How else can you save on an electric vehicle (EV) purchase? We’ve compiled a few helpful links to help you further reduce the cost of purchasing and operating your new EV.
Federal Tax Credit
Up to $7,500
Battery and plug-in hybrid electric vehicles may be eligible for a tax credit up to $7,500 from the federal government, depending on the capacity of the EV’s battery. Visit fueleconomy.gov to check out the breakdown of tax credit amounts.
The federal EV tax credit amount is affected by your tax liability. For example, if you purchase an EV eligible for $7,500, but you owe only $4,000 in taxes, you will receive a $3,500 credit.
If you lease your EV, the tax credit goes to the leasing entity. However, dealerships often factor the tax credit into the cost of the lease, lowering your down payment or monthly payments. Ask your sales representative how your tax credit will be applied.
Once a manufacturer sells 200,000 eligible plug-in electric vehicles, the available federal tax credit begins to phase out. For details on phase out amounts, go to fueleconomy.gov.
|Tax Credit Amount
|For Vehicles Delivered
|On or before Dec. 31, 2019
|Jan. 1 to June 30, 2020
|July 1 to Dec. 31, 2020
|After Dec. 31, 2020
Please note, Charge Up New Jersey is not a tax credit program but a separate EV incentive program. For eligibility requirements and applicable deadlines, please see the eligibility guidelines.
Exemption from New Jersey Sales Tax
The New Jersey Legislature exempts residents from paying state sales tax on the purchase or lease of a zero-emissions vehicle, which includes BEVs but not PHEVs. With the current sales tax rate at 6.625%, this is a significant incentive that offers hundreds to thousands of dollars off the vehicle cost – at the point-of-purchase.
To apply this incentive at the dealership, the customer must fill out a sales tax Exempt Use Certificate (Form ST-4), which is available from the New Jersey Division of Taxation online. The New Jersey Department of Environmental Protection’s Drive Green website has a list of vehicles that are eligible for the sales tax exemption.