Back in November 2024, we wrote about the incoming federal administration’s intention to do away with the federal tax credit for electric vehicles (EVs). We’re now well into tax season in 2025, and the federal tax credit is still in existence — for now. However, we do have important news to share, whether you bought an EV in 2024 or are considering buying one in 2025.

If You Bought In 2024 

If you bought an EV in 2024, you need to file Form 8936 with your federal taxes, even if you received the federal tax credit at the point of sale and even if you don’t normally file. To do that, you need the time-of-sale report that the seller should have given you within three days of the sale of the vehicle. This IRS page details how to get the credit and links to this step-by-step guide.

Unfortunately, we are hearing reports that many people are having trouble with this process because the seller did not provide them with that crucial time-of-sale report. This Heatmap article explains the situation well.

We have learned that the National Auto Dealers Association (NADA) has sent a letter to the Treasury requesting that the federal government open up the portal again to allow dealers to submit those time-of-sale reports retroactively, but it’s anyone’s guess whether anybody at the Treasury will respond. 

If you bought an EV in 2024 and do not have the time-of-sale report, reach out to your seller and ask them to send it to you. If they did not submit the time-of-sale report within the three-day window, unfortunately, the IRS says the following: 

Step 4: If you didn't get a time-of-sale report: Contact your seller

If you didn't get a time-of-sale report at the time of purchase or you lost it, contact the seller to get a copy of the report.

If you do not have a successfully submitted time-of-sale report, you are not eligible to claim the credit.

If You’re Looking To Buy In 2025 

Since the federal tax credit for EVs was implemented by an act of Congress, the Trump administration can’t unilaterally do away with it. To rollback the credit, Congress would have to pass a bill that repeals EV tax credit provisions in the Inflation Reduction Act, or the Trump administration would have to tweak how they implement the tax credit in a way that effectively renders it ineffective. So far, we haven’t seen them take action on either front. (Though of course, we have seen a ton of action to weaken federal vehicle regulations, attack states’ right to have their own vehicle efficiency regulations, and implement tariffs that will dramatically impact the car market — more on all that in another blog.)

Right now, if you visit the FuelEconomy.gov website, you can see a list of vehicles that qualify for the federal tax credit in 2025. That means, in theory, you should still be able to get the federal tax credit if you purchase a qualifying new or used vehicle in 2025.

Screenshot of FuelEconomy.gov (more vehicles qualify than the ones shown on this screenshot; visit FuelEconomy.gov for the full list.)

What Happens If The Federal Tax Credit Disappears? 

The federal tax credit for the purchase of EVs is an important policy that we need to accelerate EV adoption in line with our climate mandates in Massachusetts and Rhode Island. Beyond just increasing the number of gas cars replaced by EVs, it’s a crucial tool for making EV access more equitable. The provisions in the IRA to make the tax credit limited to consumers with incomes below a certain level, limited to vehicles below certain Manufacturer’s Suggested Retail Prices, available for used cars, and to make it available at the point-of-sale, went a long way towards making sure that drivers with different incomes can purchase EVs.  

Economists are debating what exactly will happen if and when the tax credits disappear. A Princeton study warns that getting rid of the tax credits in the IRA will result in 8.3 million fewer EVs on the road by 2030, dropping sales 40% by 2030 compared to where we would be with IRA provisions. The study also warns of impacts on the manufacturing of EVs, as many battery and vehicle plants are getting built thanks to IRA tax credits as well. This tracker shows you the hundreds of billions of dollars of investments in clean energy projects broadly since the IRA; you can filter for clean vehicles and see $78 billion in investments. Other economists have a more tempered or optimistic view. (If you’ve got an hour, this video is worth a watch.) 

Long story short: How EV adoption progresses in the next few years will be influenced by the availability of the federal tax credit in the United States, but there are so many other factors at play — federal and state vehicle efficiency standards, infrastructure funding, tariff implementation, global market developments, etc. — that it’s hard to say just how massive any tax credit impact will be in the short and long run.