The Inflation Reduction Act which includes an electric vehicle tax credit was signed into law by President Biden. Although the tax is not new, the rules have been altered.
Essentially, there are price caps on the vehicles eligible for the credit, as well as rules governing where the EVs are built and where the battery materials are sourced.
According to TechCrunch, roughly 70% of EVs in the US (72 current models) that are eligible for the current credit will no longer be eligible for the new credit.
Having said that, the Biden Administration has announced that approximately 20 current and upcoming electric vehicles will be eligible for the new credit. Meanwhile, automakers such as General Motors and Tesla who had been phased out due to sales caps will become eligible for the new Clean Vehicle Credit in 2023.
The following 2022 models are eligible for a federal EV tax credit through the end of the year, according to the Administration:
Audi Q5
BMW 3 Series Plug-In
BMW X5
Chrysler Pacifica PHEV
Ford Escape PHEV
Ford F-150 Lightning
Ford Mustang Mach-E
Ford Transit Van
Jeep Grand Cherokee PHEV
Jeep Wrangler PHEV
Lincoln Aviator PHEV
Lincoln Corsair Plug-in
Lucid Air
Nissan Leaf
Rivian EDV
Rivian R1S
Rivian R1T
Volvo S60 Recharge PHEV
Finally, the following electric vehicles are not currently eligible, but will be on January 1, 2023:
2022/2023 Chevrolet Bolt EV
2022/2023 Chevrolet Bolt EUV
2022 GMC Hummer EV (pickup truck and SUV)
2022 Tesla Model 3
2022 Tesla Model S
2022 Tesla Model X
2022 Tesla Model Y
2023 Cadillac Lyriq
Many of the new rules will not take effect until January 1, 2023, at which point most of the electric vehicles currently on the market will become ineligible.