Cars 2022: Understanding EV Tax Credits & North American Assembly

The landscape for electric vehicle (EV) tax credits in the United States underwent significant changes with the Inflation Reduction Act of 2022. This legislation, enacted in August 2022, brought forth new rules, particularly concerning where EVs must be assembled to qualify for the Clean Vehicle Credit. For those interested in Cars 2022 and beyond, understanding these assembly requirements is crucial for maximizing potential tax benefits.

Decoding the Clean Vehicle Credit for Cars 2022 and Later

The Inflation Reduction Act amended the existing Qualified Plug-in Electric Drive Motor Vehicle Credit, rebranding it as the Clean Vehicle Credit. A key update effective August 17, 2022, is the mandate for final assembly of eligible vehicles to be in North America. This requirement applies to new electric, fuel cell electric, and plug-in hybrid electric vehicles acquired and placed in service after August 16, 2022. For cars 2022 purchased after this date, and especially for vehicles placed in service from January 1, 2023, onwards, these updated guidelines are essential.

For the most current and detailed information on eligibility criteria for the Clean Vehicle Credit, it’s recommended to consult the official IRS resources. Additionally, FuelEconomy.gov provides a vehicle-specific list of federal tax credits. A concise summary of the credit can also be found on Electric Vehicle (EV) and Fuel Cell Electric Vehicle (FCEV) Tax Credit.

A significant change starting January 1, 2024, allows car buyers to directly reduce the purchase price of a clean vehicle by transferring their Clean Vehicle Credit to the dealership at the point of sale. Prior to 2024, the credit could only be claimed when filing annual tax returns. Now, dealerships must register with the IRS through the IRS Energy Credits Online portal to facilitate this credit transfer and verify vehicle eligibility. This registration and submission to the IRS are mandatory for buyers to benefit from the tax credit, either as a point-of-sale reduction or as a credit on their tax return. Dealers are also required to provide buyers with proof of IRS approval for the credit transfer. For the latest updates on this point-of-sale credit transfer for both dealers and consumers, refer to the IRS Clean Vehicle Tax Credit page.

North American Assembly Requirement for Cars 2022 (August 17 – December 31, 2022)

The list below specifically highlights cars 2022 and some early cars 2023 models that met the final assembly in North America requirement for vehicles purchased and delivered between August 17 and December 31, 2022. This list, based on Fuel Economy labeling data and manufacturer submissions to the EPA and NHTSA as of December 31, 2022, serves as a guide for vehicles from Model Year 2022 and 2023. It’s important to note that for vehicles purchased from January 1, 2023, onwards, verifying final assembly should be done using a VIN decoder. Further details can be found at Electric Vehicle (EV) and Fuel Cell Electric Vehicle (FCEV) Tax Credit and IRS Qualified Plug-in Electric Drive Motor Vehicle Credit.

It’s also crucial to be aware that some manufacturers of vehicles assembled in North America had already reached the 200,000 EV credit cap for vehicles acquired before January 1, 2023. For these manufacturers (indicated below), the full tax credit might not have been available for vehicles acquired before this date. However, this sales cap is no longer applicable for vehicles acquired after December 31, 2022.

**Electric Vehicles Assembled in North America (for purchases between Aug 17 – Dec 31, 2022)**Note: Additional eligibility conditions may apply depending on the purchase date.

This list is subject to updates as manufacturers provide new vehicle information. For change requests regarding this vehicle list, manufacturers can use the website contact form. More details for manufacturers are available at details for manufacturers.

Rules for Cars Purchased Before August 17, 2022

For cars 2022 or earlier models purchased before August 17, 2022, the North American final assembly requirement does not apply for tax credit eligibility. More information can be found at Electric Vehicle (EV) and Fuel Cell Electric Vehicle (FCEV) Tax Credit and IRS Qualified Plug-in Electric Drive Motor Vehicle Credit.

Confirming Assembly Location via VIN for Cars 2022 and Beyond

To definitively determine the assembly location of a specific vehicle, especially crucial for verifying eligibility for the Clean Vehicle Credit for cars 2022 and later, the Vehicle Identification Number (VIN) is the key. A VIN decoder, such as the one provided by the NHTSA (VIN decoder), can reveal the vehicle’s build plant and country of origin, among other details. You can use the VIN decoder to check the assembly location of your vehicle.

Verifying North American final assembly is a preliminary step in determining Clean Vehicle Credit eligibility. Remember that additional conditions might apply based on the purchase date. For vehicles placed in service from January 1, 2023, refer to IRS Credits for New Electric Vehicles Purchased in 2023 and After for comprehensive details. For any eligibility questions, it’s best to contact the vehicle manufacturer or consult IRS information directly.

Keep in mind that for certain manufacturers, the assembly location can vary depending on the specific vehicle, trim level, or production date within the model year. Always verify the build location using the VIN decoder or the information label on the vehicle itself. For VIN-related or other eligibility inquiries, consumers should contact the manufacturer directly.

North America, for the purpose of final assembly location, includes the United States, Puerto Rico, Canada, and Mexico.

Disclaimer: The information provided here is for informational purposes only and should not be considered official or legally binding. For complete details and the most up-to-date eligibility requirements, please refer to IRS.gov/cleanvehicles.