The 2025 EV tax credit is closed to any vehicle acquired after September 30, 2025, under the One Big Beautiful Bill Act (OBBBA). If you signed a written binding contract and made a payment on or before that date, you can still claim it on Form 8936 for the year you took possession, even if that was in 2026.
That cutoff applies to the new clean vehicle credit (Section 30D), the previously owned clean vehicle credit (Section 25E) and the qualified commercial clean vehicle credit (Section 45W). This guide, current as of November 2026, explains how the 2025 EV tax credit worked, the acquisition rule the IRS uses to decide who made the deadline, how to file the claim on a 2025 or 2026 return, and which related breaks lasted into 2026.
The Act cut all three vehicle credits off for any vehicle acquired after September 30, 2025. The IRS summarizes the change in its OBBBA energy provisions FAQ: for Sections 30D and 45W, "The credit will not be allowed for any vehicle acquired after September 30, 2025," and Section 25E carries the same date.
The same FAQ set later deadlines for a few related provisions. The alternative fuel vehicle refueling property credit (Section 30C), which covered home and business EV chargers, ended for property placed in service after June 30, 2026. The new energy efficient home credit for builders, covered in our guide to the 45L tax credit for home builders, ended for homes acquired after June 30, 2026.
For a buyer shopping in late 2026, the practical result is simple. No federal purchase credit applies to a new or used EV acquired today, and the home charger credit has also closed. The Act did create a separate break for some vehicle buyers, explained in our guide to the new car loan interest deduction, and it has its own eligibility rules.
The deadline turns on acquisition, which the IRS separates from delivery. According to the FAQ, "a vehicle is 'acquired' as of the date a written binding contract is entered into and a payment has been made." The FAQ adds that "A payment includes a nominal downpayment or a vehicle trade-in."
Acquisition alone does not create the credit. The vehicle must also be placed in service, which happens when you take possession. The IRS FAQ states that a buyer with a binding contract and a payment on or before September 30, 2025 "will be entitled to claim the credit when they place the vehicle in service (namely, when they take possession of the vehicle), even if the vehicle is placed in service after September 30, 2025."
This creates four practical situations:
The third case matters for back-ordered vehicles. Because the credit follows the placed in service date, a vehicle delivered in 2026 under a pre-deadline contract is reported on the 2026 return rather than the 2025 one. Keep the signed contract and the payment receipt with your tax records, since those two documents prove the acquisition date.
The new clean vehicle credit under Section 30D was worth up to $7,500. The IRS page on credits for new clean vehicles lists the vehicle requirements, including a battery capacity of at least 7 kilowatt hours, a gross vehicle weight rating under 14,000 pounds and final assembly in North America.
The amount depended on battery sourcing. A vehicle earned $3,750 for meeting the critical minerals requirement and $3,750 for meeting the battery components requirement, so a vehicle that met only one rule was capped at $3,750.
Two price and income tests also applied:
The income test has a helpful lookback. The IRS says, "You can use your modified AGI from the year you take delivery of the vehicle or the year before, whichever is less." A single filer with $162,000 of modified AGI in 2024 and $148,000 in 2025 who took delivery in 2025 qualifies, because the lower year ($148,000) is under the $150,000 limit.
The previously owned clean vehicle credit gave buyers of used EVs and fuel cell vehicles a smaller break. Per the IRS, "The credit equals 30% of the sale price up to a maximum credit of $4,000." The vehicle had to be bought from a dealer for $25,000 or less, with a model year at least 2 years earlier than the calendar year of purchase.
The buyer limits were tighter than for new vehicles: modified AGI of $150,000 for joint filers or a surviving spouse, $112,500 for heads of household and $75,000 for other filers. A buyer also could not have claimed another used clean vehicle credit in the 3 years before the purchase.
Businesses and tax-exempt organizations used the qualified commercial clean vehicle credit. It had no MSRP cap and no income test. The maximum was $7,500 for vehicles under 14,000 pounds and $40,000 for heavier vehicles.
The credit equals the smallest of three figures: the maximum credit for the weight class, a percentage of the vehicle's basis (30% for vehicles with no gas or diesel engine, 15% for plug-in hybrids) and the incremental cost over a comparable gas or diesel vehicle. The IRS says, "The smallest figure is your credit amount."
Three illustrative vehicles:
For most businesses, the Section 45W credit is a component of the general business credit and flows through Form 3800, explained in our guide to claiming the general business credit on Form 3800. Partnerships and S corporations file Form 8936. A business vehicle acquired after the cutoff still qualifies for ordinary cost recovery, and the IRS rules in Publication 946 on depreciation apply as usual. Business use percentages and mileage records follow the car expense rules in our Publication 463 guide.
Every buyer claiming the new or used credit files Form 8936, with a Schedule A (Form 8936) completed for each vehicle, with the return for the year the vehicle was placed in service. The Form 8936 instructions state that this applies even if you transferred the credit to the dealer for a lower price at the time of sale.
The filing steps:
Two limits catch people at filing time. First, if you transferred the credit and no longer qualify when you file, the instructions state that "you must repay the amount of the credit that you transferred to the dealer." A buyer whose income rose above the cap in both years falls into this group. Second, the personal use portion of the credit is nonrefundable. The instructions state, "The unused personal portion of the credit cannot be carried back or forward to other tax years." A buyer with $4,000 of federal income tax and a $7,500 credit loses the remaining $3,500.
The charger credit was the last consumer EV break to close, and it ended for property placed in service after June 30, 2026. On the alternative fuel vehicle refueling property credit page, the IRS says that for property placed in service at your main home "from January 1, 2023, to June 30, 2026, the credit equals 30% of the cost of the property up to a maximum credit of $1,000 per item." A home charger installed for $2,400 in March 2026 produces a credit of $720.
The charger must sit in an eligible low-income community or non-urban census tract, which you check by looking up the property's 11-digit census tract identifier (GEOID) in the IRS list. Business property earns 6% of cost, or 30% when prevailing wage and apprenticeship requirements are met, with a $100,000 cap per item. The credit is claimed on Form 8911 with the 2026 return. A charger placed in service on or after July 1, 2026 gets no credit.
Other clean energy incentives followed their own OBBBA timelines. According to the same IRS FAQ, the energy efficient home improvement credit (Section 25C) is not allowed for property placed in service after December 31, 2025, and the residential clean energy credit (Section 25D) is not allowed for expenditures made after December 31, 2025. Homeowners can check where the solar credit stands in our article on the residential clean energy credit in 2026, and business owners can compare the remaining options in our guide to green energy tax credits for small businesses.
Preparers working through late 2025 returns, amended returns and 2026 returns with EV purchases can confirm each claim with a short review:
Firms that split this work between staff and offshore reviewers can fold it into the 1040, 1065 and 1120 tax prep workflow as a document request item.
Is the 2025 EV tax credit still available for a vehicle bought in 2026? No. The new, used and commercial clean vehicle credits are unavailable for any vehicle acquired after September 30, 2025. A 2026 purchase qualifies only if the binding contract and payment were made on or before that date.
Can I claim the credit if I paid a deposit in September 2025 and took delivery later? Yes. The IRS treats a vehicle as acquired once a written binding contract is in place and a payment, including a nominal down payment or trade-in, has been made. You claim the credit for the year you take possession.
Do I still file Form 8936 if the dealer gave me the credit at the sale? Yes. Form 8936 and Schedule A are required whether you transferred the credit or are claiming it on your return. If you no longer qualify when you file, you must repay the amount transferred.
What happens if my tax bill is smaller than the credit? The personal use portion is nonrefundable and cannot be carried back or forward, so any amount above your tax liability is lost. The business use portion is treated as a general business credit and reported through Form 3800.
Is the EV charger credit still available? No. The Section 30C credit ended for property placed in service after June 30, 2026. A qualifying charger placed in service at a main home between January 1 and June 30, 2026 can still be claimed on the 2026 return.
Madras Accountancy supports US CPA firms and their clients with tax preparation, bookkeeping and review work, including documenting clean vehicle and energy credit claims. To discuss support for your firm's 2025 and 2026 returns, contact our team.
This article is general information and does not constitute tax advice. Confirm the treatment of any specific vehicle with the client's records and the current IRS instructions.
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