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Alternative Fuel Vehicle Refueling Property Credit

This credit was extended by IRA 2022 in two phases: (1) the existing rules are extended through 2022 (was through 2021) and (2) a new set of rules applies beginning in 2023 through 2032.

Credit Through 2022  

A credit is allowed for qualified alternative fuel vehicle refueling property, including property to recharge an electric vehicle, but only if the recharging property was located at the point where the vehicle is recharged. This included installation of a home charging station for an electric vehicle. The creditable cost will be whatever it costs to install the charging installation at the home, including the labor. The credit is 30% of the cost and claimed on Form 8911. The maximum credit is:

  • Personal use - limited to $1,000 per home and is a non-refundable personal credit allowed against the AMT.
  • Business use - limited to $30,000

If the taxpayer’s vehicle use is split between personal use and business use the credit must be split between the personal and business use credits.

If the credit was overlooked in a year before it can be claimed on an amended return where the refund statute has not expired, and some reasonable tax benefit can be obtained.

Credit 2023 Through 2032  

  • The credit for depreciable property is at a rate of 6% (Code Sec 30C(a), Act Sec 13404(b)(1)),
  • Increased to 30% if certain prevailing wage and apprenticeship requirements are met (Act Sec. 13404(d)),
  • Subject to a limit of $100,000. (Sec 30C(b), Act Sec. 13404(b)(2)(B))

The Act modifies the definition of eligible property to include bidirectional charging equipment (Act Sec. 13404(b)(3)) and provides that the credit is available for electric charging stations for two- and three wheeled vehicles that are intended for use on public roads. (Act Sec. 13404(c))

Under the Act, the credit limitation applies per single item of qualified alternative fuel vehicle refueling property instead of all such property at an individual location. (Sec 30C(b), Act Sec. 13404(b)(2)(A))

Charging or refueling property will only be eligible for the credit if placed in service within a low-income or rural census tract. (Act Sec. 13404(e))  See Notice 2024-20 for eligible list of census tracks.

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