The Used EV Tax Credit: $4,000 for Pre-Owned EVs

What is the used EV tax credit?

The §25E Previously Owned Clean Vehicle Credit provides a federal tax credit of up to $4,000 — or 30% of the sale price, whichever is less — for purchasing a used electric vehicle. This credit was introduced by the Inflation Reduction Act and took effect January 1, 2023.

Eligibility requirements

Vehicle requirements: The vehicle must be at least 2 model years old at the time of purchase, have a sale price of $25,000 or less, and be purchased from a licensed dealer (not a private party). The vehicle must have a battery capacity of at least 7 kWh.

Income limits: Your MAGI must be below $75,000 for single filers, $112,500 for heads of household, and $150,000 for married filing jointly — significantly lower than the new vehicle credit limits.

First-time use: The credit can only be claimed once per vehicle. If a previous owner already claimed the credit on the same vehicle, you cannot claim it again.

How to claim the used EV credit

File IRS Form 8936 with your tax return, checking the box for the previously owned vehicle credit. Like the new vehicle credit, the used EV credit can also be transferred to the dealer at the point of sale since 2024.

Best used EVs under $25,000 in 2025

Used Tesla Model 3 (2021-2022 models), Chevrolet Bolt EV (2020-2022), Nissan Leaf (2019-2021), Hyundai IONIQ Electric (2019-2020), and Volkswagen e-Golf (2019-2020) are among the most commonly available used EVs under the $25,000 price cap.