Some States are Stacking on EV Tax Credits & Rebates on to Federal EV Tax Credits
This state electric vehicle tax credit and rebate guide has been updated with information for the 2025 and 2026 tax years. In my most efficient vehicles, cheapest new vehicles, and cheapest electric vehicles articles, I highlighted a few electric vehicles that have prices that rival the cheapest gas-powered vehicles for sale in the U.S. market. But, a key component of that reduced cost was the U.S. federal tax credit of $7,500 knocking the net price down significantly. Unfortunately, the federal EV tax credit was ended prematurely on 9/30/25.
What’s left in 2026 is a smattering of state plug-in hybrid (PHEV) and electric vehicle (EV) tax credits, rebates, and incentives. This article will break down all of those state-level PHEV and EV incentives. First, let’s recap the now expired federal electric vehicle tax credit and which vehicles (and taxpayers) were eligible for it. Here’s everything that we’ll cover in this article:
Federal Electric Vehicle Tax Credit (Pre-Inflation Reduction Act)
The federal electric clean vehicle tax credits were scheduled to run through 2032, but were prematurely ended in 2025 with the OBBBA legislation that was passed. Any EV/PHEV vehicle purchased after 9/30/25 is not eligible for the federal electric vehicle tax credit (including any vehicles purchased in 2026 and after, unless the law changes again). All that said, here’s a recap of which vehicles were eligible for tax credits in 2025, prior to the law change.
2025 Federal Electric Vehicle Tax Credits
The Inflation Reduction Act (signed in 2022 and placed into effect in 2023) made a number of key changes to the PHEV and electric vehicle federal tax credits and renamed them as the “Clean Vehicle Tax Credit”. The 6 biggest changes were:
- Major vehicle requirement changes:
- have a battery capacity of at least 7 kilowatt hours.
- be made by a qualified manufacturer.
- have final vehicle assembly in North America.
- meet certain battery and minerals sourcing criteria.
- have a maximum vehicle MSRP of $80,000 for vans, sport utility vehicles and pickup trucks and $55,000 for other vehicles.
- Removed automaker vehicles-sold volume phaseouts.
- Taxpayer modified adjusted gross income (MAGI) eligibility caps were added.
- Used electric vehicles are now potentially eligible for up to a $4,000 tax credit.
- Starting in 2024, dealerships will be able to offer the value of a tax credit up front to consumers.
- Creation of a “Clean Commercial Vehicle Credit”, which effectively created a loophole opportunity for auto lessors to pass along a $7,500 EV lease tax credit to consumer lessees.
The “final vehicle assembly in North America” and battery and minerals sourcing criteria dramatically impacted which electric vehicles were eligible for the full $7,500 clean vehicle tax credit, a partial credit, or no credit at all. Here’s a list of all PHEVs and EVs that were eligible for a federal tax credit with the new federal materials, sourcing, and manufacturing requirements
As noted above – the federal EV tax credit now ends prematurely on September 30, 2025.
Where & How to Claim a State Electric Vehicle Tax Credit
It’s good to know all of the details included in this article for your state (and federally), but all of the best tax software and even cheapest ways to e-file will have versions of their product that will walk you through both federal and state electric vehicle tax credit eligibility and the claim process. Here’s some best-available partner discounts (automatically applied when clicking below links) for them.
A State-by-State List of Electric Vehicle Tax Credits, Rebates, & Incentives
On top of the electric vehicle tax credit, a number of states have hybrid and electric vehicle tax credits, rebates, and incentives. I’ll highlight what I was able to dig up for 2025 and 2026, but you will need to do some further digging and check with your state to make sure these incentives still apply, as they change frequently, and often depend on state funding per year (first-come, first-serve). Some states have run out of funding early or mid-year in the past, so it’s important to do your homework prior to purchase, not after. If your state is not listed, my research came up empty. If I missed something in your state, let me know and I’ll add it.
California
After a year off, California has proposed $200 million in new funds for EV tax credits in 2026 to backfill for the expired federal EV tax credits. Details have not been published as of the date of this articles publish date, but keep an eye on the California Clean Vehicle Rebate Project website for updates.
Colorado
Colorado’s electric vehicle tax credits have been extended with a phaseout in place for purchases of electric vehicles in the following years:
| Tax Year | Purchase EV Credit Amount | Lease EV Credit Amount |
|---|---|---|
| 2025 | $3,500 on vehicle with price up to $80,000 + $2,500 if price of vehicle is less than $35,000 | $3,500 on vehicle with price up to $80,000 + $2,500 if price of vehicle is less than $35,000 |
| 2026 | $750 on vehicle with price up to $80,000 + $2,500 if price of vehicle is less than $35,000 | $750 on vehicle with price up to $80,000 + $2,500 if price of vehicle is less than $35,000 |
Connecticut
The state of Connecticut’s Hydrogen and Electric Automobile Purchase Rebate (CHEAPR) program offers vehicle rebates for Connecticut residents who purchase or lease a new eligible electric, fuel cell electric, or plug-in hybrid electric vehicle – up to a maximum MSRP of $50,000. Expanded “Rebates+” credits are available for those who meet one of the following lower income criteria.
- Reside in an Environmental Justice (EJ) Community or Distressed Municipality
- Participate in a qualifying state or federal income qualifying program
- Have income less than 300% of the Federal Poverty Level (FPL)
See the full FAQ for more details. Funds are limited and all funds are allocated on a first-come, first-serve basis, in the following amounts:
| Vehicle Type: | CHEAPR Standard Rebate Amount: | Rebate+ Additional Rebate for New Vehicles Amount (for low income) + Standard Rebate: | Rebate+ Used Vehicles Amount (for low income): |
|---|---|---|---|
| Plug-In Hybrid Electric Vehicle (PHEV) | $750 (decreased to $500 on 8/1/25) | $1,500 | $2,250 (decreased to $2,000 on 8/1/25) |
| Battery Electric Vehicle (BEV) | $1,500 (decreased to $500 on 8/1/25) | $3,000 | $4,500 (decreased to $3,500 on 8/1/25) |
| Fuel Cell Electric Vehicle (FCEV) | $1,500 (decreased to $500 on 8/1/25) | $3,000 | $4,500 (decreased to $3,500 on 8/1/25) |
Note that the state lowered the base amounts beginning on 8/1/25.
Delaware
The state of Delaware is offering electric vehicle cash rebates totaling up to $2,500 depending on vehicle type. The rebate must be applied for within 90 days of the purchase date. Rebate amounts are as follows:
| Vehicle Type: | Rebate Amount: |
|---|---|
| New Battery Electric Vehicles, base MSRP below $40,000 | $2,500 |
| New Battery Electric Vehicles, base MSRP between $40,000 & $50,000 | $1,500 |
| New Plug-in Hybrid Electric Vehicles, base MSRP below $50,000 | $1,000 |
| Used Battery Electric Vehicles, with fair market purchase price (KBB) $40,000 or less | $2,500 |
| Used Plug-in Hybrid Electric Vehicles, with fair market purchase price (KBB) $40,000 or less | $1,000 |
Illinois
The Illinois Electric Vehicle Rebate Program (funded by the Illinois Environmental Protection Agency) is making rebates available for Illinois residents that purchase a new or used all-electric vehicle from an Illinois licensed dealer in the following amounts. The most recent round of funding was approved for 10/28/25 – 1/41/26 and is for the following amounts:
- A $4,000 rebate to a low-income applicant, as defined in the EV Rebate Act, for the purchase of an all-electric vehicle that is not an electric motorcycle.
- A $2,000 rebate to an applicant that is eligible to apply for a rebate but does not meet the low-income criteria for the purchase of an all-electric vehicle that is not an electric motorcycle.
- A $1,500 rebate to an eligible applicant for the purchase of an all-electric motorcycle.
The selling price of the vehicle cannot exceed $80,000. It appears that funding/applications frequently pause and restart as funding is available. See the FAQs here for more info.
Maine
Maine suspended electric vehicle rebates starting November 16, 2024, for all but low-income residents. Unfortunately, details are slim on the current rebate level and critieria, but there is a form that can be filled out to determine eligibility.
Enhanced rebates for qualified low income levels were previously listed as:
- New EV: $7,500
- New PHEV: $3,000
- Used EV or PHEV: $2,500
Maryland
Maryland was offering an excise tax credit of $3,000 on vehicles $50,000 and less through 2027 on a qualifying zero-emission plug-in electric or fuel cell electric vehicles, but funding comes and goes and does not appear to be active as of early 2026.
Massachusetts
The Massachusetts Department of Energy Resources has a program called Massachusetts Offers Rebates for Electric Vehicles (MOR-EV), which offers rebates for the purchase or lease of new or used electric vehicles, including battery and fuel-cell electric vehicles. It is funded through 2027.
There is a $3,500 rebate for the purchase or lease of new vehicles with a purchase price under $55,000. An additional $1,500 (MOR-EV+) applies to individuals below specified income levels. And an additional $1,000 is available when trading in a vehicle that is at least 12 years old.
New Jersey
- A $1,500 “Charge Up” incentive at point of sale on eligible EVs.
- A $4,000 pre-approved “Charge Up+” incentive on eligible EVs if income is below specified levels.
- A $250 in-home EV charger incentive.
More details found here.
New York
New York offers tax rebates for new electric vehicles, in the following amounts:
- Greater than 200-mile range: $2,000 rebate
- 40- to 199-mile range: $1,000 rebate
- Less than 40-mile range: $500 rebate
- MSRP greater than $42,000: $500 rebate
Oregon
Oregon had a “Charge Ahead Rebate” of up to $7,500 for a new purchased or leased EV and $5,000 for a used purchased or leased EV, but it was suspended 9/9/25. Keep an eye out for new funding in 2026.
Pennsylvania
Pennsylvania offers EV rebates for new and used electric vehicles with final purchase price of $45,000 or less (purchase or lease) for the following amounts:
- Battery electric vehicle (new, demo, or 1-time pre-owned): $3,000
- Plug-in hybrid (PHEV) cars and trucks: $1,500
- All other alternative fuel vehicles, and electric motorcycles: $500
- Max household income cannot be more than 300% above the federal poverty level.
- An additional $1,000 is available to applicants who meet lower-income requirements (max household income not above 150% of the federal poverty level).
Rhode Island
Rhode Island’s DRIVE EV Rebate program is offering the following incentives:
- Rebates of up to $3,000 for the purchase or lease of new battery electric vehicles and fuel-cell electric vehicles, and up to $2,000 for new plug-in hybrid electric vehicles (below $75,000 vehicle price only).
- Rebates of up to $2,500 for the purchase or lease of used battery electric vehicles and fuel-cell electric vehicles, and up to $1,750 for used plug-in hybrid electric vehicles (below $55,000 vehicle price only).
- Rebates of up to $800, or 100% (whichever is less) of the purchase price of a Level 2 Residential EV Charger, and $1,000, or 50% (whichever is less) of the installation costs of a Level 2 Residential EV Charger. Higher rebate amounts are also available for income-qualified applicants.
An additional rebate of up to $1,500 is available to applicants that participate in a state or federal income-qualified program (see DRIVE+). Rebates are awarded on a first-come, first-served basis.
Don’t Forget About the Improved Federal Energy Tax Credits & New Energy Rebates
Also don’t forget about the federal energy tax credits and rebates. There were significant updates that resulted from the Inflation Reduction Act available (including solar panels, electrical panels, battery storage, and EV charging) that were live for 2025, but were mostly (not completely) ended prematurely with the OBBBA legislation for 2026 and beyond. The linked-to article is a complete guide to the 2 improved energy tax credits and 2 new energy rebates available to Americans.
PHEV & Electric Vehicle State Tax Credit Discussion
If you live in one of these states are these incentives, matched with the federal credit enough to make you consider a PHEV or electric vehicle purchase?
Let me know if I missed any states above!