What tax credits are available for hybrid cars?


Quick Answer

As of 2015, plug-in hybrid-electric vehicles (PHEVs) purchased in 2010 or later may be eligible for a federal tax credit up to $7,500, according to the United States Department of Energy. The amount of the tax credit varies depending on the capacity of the battery that fuels the vehicle.

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Full Answer

The PHEV must be purchased new, be used mostly in the United States, and be purchased for use or lease of the taxpayer and not for resale purposes, according to the U.S. Department of Energy. The vehicle also must have a gross vehicle weight rating of 14,000 pounds or less, and be made by a manufacturer as opposed to being a conventional vehicle converted to electric in order to qualify for the federal tax credit, as of 2015.

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