Does a Hybrid Car Qualify for a Tax Credit?


Quick Answer

Many plug-in hybrid electric cars qualify for up to $7,500 in federal tax credits as of 2015, according to the U.S. Department of Energy. Several states also offer tax credits and other incentives, as reported by the National Conference of State Legislatures.

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Full Answer

The federal tax credit is available only for new qualifying cars that were bought in 2010 or later, states the U.S. DOE. The car must be made by a manufacturer rather than converted from a conventional vehicle and powered in large part by an electric motor that can be recharged.

At least 37 states offer incentives such as tax credits and reduced registration fees as of 2014, according to the NCSL.

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