Business Tax Credits for Electric Vehicles

Are you in the market for a new vehicle or perhaps a fleet of vehicles for your business? Have you considered going electric? Most people think that the only major financial benefit to electric vehicles is the gas savings – truth be told, that is just the tip of the iceberg.

In addition to saving up to 75% in fuel costs there are major savings in maintenance and mechanics. Because these vehicles do not have a transmission or combustion engine you will be able to omit oil changes, fuel filters, emissions testing and other costly upkeep. In addition to being low maintenance, the drive train and braking system design is simpler, resulting in greater reliability which will render fewer repairs. And last but not least, electric vehicles also offer tax credits!

According to the IRS.gov website, “For vehicles acquired after December 31, 2009, the credit is equal to $2,500 plus, for a vehicle which draws propulsion energy from a battery with at least 5 kilowatt hours of capacity, $417, plus an additional $417 for each kilowatt hour of battery capacity in excess of 5 kilowatt hours. The total amount of the credit allowed for a vehicle is limited to $7,500.”

Electric vehicle pricing is comparable to that of mid-range cars on the market. What does that mean? That means that simply by purchasing a single electric vehicle, you immediately save up to $7500 on your taxes. You are, at the end of the day, saving money on a purchase you would have made regardless.

Have you recently purchased an electric vehicle used for business purposes? Are you planning on purchasing one? Calculating the tax breaks can be challenging – we recommend reaching out to someone who has experience. Employer Solutions Plus is partnered with those who are well versed in tax filings and can help you maximize your deductions like this one.