Federal EV Charger Tax Credit from US Federal Gov’t

The Federal EV Charger Tax Credit allows a credit for qualified alternative fuel vehicle refueling property placed in service during the tax year. For business/investment use property, the credit is the smaller of 6% (or 30% if prevailing wage/apprenticeship requirements are met) of the property’s cost or $100,000 per item. For personal use property installed at your main home, the credit is generally the smaller of 30% of the cost or $1,000 per item.

To qualify, the refueling property must:

• Be used to store/dispense alternative fuels or recharge electric vehicles
• Have its original use begin with you
• Not be used predominantly outside the U.S.
• Be installed at your main home (for personal use)
• Be located in an eligible census tract (after 2022)

Eligible census tracts are generally low-income community tracts or non-urban areas, determined using IRS mapping tools.

For property placed in service after 2022, prevailing wage and registered apprenticeship requirements must be met to claim the higher 30% credit rate for business property. Detailed recordkeeping of wages/hours is required.

The credit is first applied against alternative minimum tax, with any excess claimed as a general business credit or nonrefundable personal credit. Tax-exempt entities can elect to treat the credit as a payment against income tax liability after 2022. Starting in 2023, credits can be transferred to third parties for cash.

The Alternative Fuel Vehicle Refueling Property Credit under IRC Section 30C incentivizes businesses and individuals to install qualified alternative fuel vehicle refueling or charging property.

For business/investment use property placed in service:

• 30% credit if project meets prevailing wage and registered apprenticeship requirements
• 6% credit if requirements not met
• Maximum credit of $100,000 per item of property
• Property cost must be reduced by any Section 179 deduction taken

For personal use property installed at main home:

• 30% credit
• Maximum $1,000 credit per item

Qualified property includes:

• Equipment to store/dispense non-electric alternative fuels like natural gas into vehicle tanks
• Equipment to recharge electric vehicles, including for 2/3 wheeled electric vehicles

Location Requirements (after 2022):

• Property must be located in eligible census tracts
• Tracts designated as low-income communities or non-urban areas based on IRS mapping tools

Recordkeeping for Prevailing Wage/Apprenticeship:

• Detailed records of wages, labor hours, apprentice hours by job classification
• Statement declaring information is true and correct

Other Key Points:

• Property basis must be reduced by credit amount
• Credit is first used against alternative minimum tax
• Unused personal credit cannot be carried forward
• Tax-exempts can elect to treat credit as estimated tax payment after 2022
• Credit transfer to third parties allowed starting in 2023
• Pre-registration required for payment/transfer elections