Treasury & IRS Issue Guidance on US Clean Vehicle Charging Infrastructure

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TL/DR –

The US Department of the Treasury and the IRS have released further details regarding eligibility for incentives under Biden’s Inflation Reduction Act, which aims to lower energy bills by encouraging the installation of electric vehicle charging stations. The Alternative Fuel Vehicle Refueling Property Credit (30C) provides a tax credit covering up to 30% of the cost of qualified alternative fuel vehicle refueling property and can be claimed by individuals and businesses, with the cap being $1,000 for personal property and $100,000 for business property. To qualify for the 30C credit, the property must be placed in an eligible census tract, defined as a low-income community or a non-urban area.


U.S. Treasury and IRS release new guidance on Inflation Reduction Act

The U.S. Department of the Treasury and Internal Revenue Service (IRS) have released additional guidance under President Biden’s Inflation Reduction Act (IRA) aimed at reducing American energy bills. The guidance provides clarity on eligibility for incentives to install electric vehicle (EV) charging stations and other alternative fuel refilling stations.

Department of Energy introduces a mapping tool

The Department of Energy is also launching a mapping tool to assist households, businesses, and organizations in determining their eligibility for the tax credit associated with these investments.

Deputy Secretary of the Treasury on the impact of the Inflation Reduction Act

“The Inflation Reduction Act has catalyzed investment and manufacturing in the United States, with electric vehicle sales surpassing 1 million for the first time in 2023,” said Deputy Secretary of the Treasury Wally Adeyemo. “Further clarity on the incentive to build new charging infrastructure in priority communities will drive continued progress in 2024.”

About the Alternative Fuel Vehicle Refueling Property Credit (30C)

The 30C works alongside the Inflation Reduction Act’s Clean Vehicle Credit and Advanced Manufacturing Production Credit to promote clean vehicle adoption, reduce consumer costs, and localize the entire clean vehicle supply chain. This incentive provides a credit for up to 30% of the cost of qualified alternative fuel vehicle refueling property.

Who can claim the credit?

Individuals can claim the credit for home EV charging and other refueling equipment, as can businesses. For a single property item, the credit limit is $100,000 for business property, and $1,000 for personal property. Elective pay-eligible entities, like governments and tax-exempt organizations investing in EV infrastructure, can also benefit.

Eligibility requirements under the IRA

The IRA expanded the 30C credit but requires that qualified property must be placed in an eligible census tract, defined as any low-income community or non-urban area.

Proposed regulations for eligible census tracts

An upcoming notice will propose regulations to define eligible census tracts. Low-income community census tracts follow the definition used for the new markets tax credit. Non-urban census tracts are those with at least 10% of the census blocks outside of urban areas. See Appendix A and Appendix B for a list of eligible census tracts.


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