August 28, 2022 – Almost all import brand electric and plug-in hybrid vehicles immediately lost their federal clean vehicle tax credit incentive eligibility when President Biden signed the Inflation Reduction Act, according to the IRS. It strips buyers of a credit that could put up to $7,500 back into their pockets at tax time.
Under the new ruling, eligible buyers need to select a vehicle that was assembled in the U.S. and has 50 percent of the battery components coming from the U.S. Moreover, 40 percent of the battery’s “critical materials” should also come from North America or nations that have in place free trade agreements with the U.S.
As of now, the non-American car models that are still eligible for the tax credit are Mercedes-Benz EQS, BMW X5 PHEV, BMW 3 Series PHEV, Nissan Leaf, Audi Q5 PHEV, and Volvo S60 Recharge.
