Charge It Up: Tax Incentives and Grants for Electric Vehicle Charging Stations

Electric vehicles (EVs) are becoming a popular choice among car buyers, with sales expected to triple by 2025 compared to 2019. Installing EV charging stations is a necessary step to promote widespread use of electric cars. However, the cost of installing charging stations can be prohibitive for individuals and businesses.

Summary:

The good news is that there are tax incentives and grants available at the federal and state levels to help offset the cost of installation.

Federal Tax Incentives

The federal government offers a tax credit for consumers who purchase and install qualified EV charging stations at their homes or businesses. The credit covers 30% of the cost of the installation, up to a maximum of $1,000 for residential installations and $30,000 for commercial installations. To qualify, the charging station must be Level 2, which provides faster charging than Level 1 charging stations.

• The tax credit is limited to installations completed between January 1, 2018, and December 31, 2021.
• The credit can be claimed on IRS Form 8911.
• Unused credits can be carried over to future tax years.

In addition to the tax credit, businesses can also take advantage of the Modified Accelerated Cost Recovery System (MACRS) to depreciate the cost of the charging station over time. Businesses can deduct 100% of the cost in the first year if the charging station is installed between September 27, 2017, and December 31, 2022.

State Tax Incentives and Grants

Many states also offer tax incentives and grants to encourage the installation of EV charging stations. Here are a few examples:

• California: The California Electric Vehicle Infrastructure Project provides grants to install EV charging stations at public locations, workplaces, and multi-unit dwellings. The state also offers rebates for up to $2,500 for residential charging stations.
• New York: The New York State Energy Research and Development Authority provides rebates of up to $4,000 for Level 2 charging stations and up to $5,000 for DC fast charging stations.
• Colorado: The Charge Ahead Colorado program offers grants of up to $6,260 for Level 2 charging stations and up to $50,000 for DC fast charging stations.

Key Takeaways

Installing EV charging stations is an important step to promote the widespread use of electric vehicles. Here are some key takeaways:

• The federal government offers a tax credit covering 30% of the cost of installation, up to a maximum of $1,000 for residential installations and $30,000 for commercial installations.
• Businesses can also take advantage of MACRS to depreciate the cost of the charging station over time.
• Many states offer tax incentives and grants to encourage the installation of EV charging stations.

The Bottom Line

While the cost of installing EV charging stations can be prohibitive, tax incentives and grants can help offset some of the expenses. If you're considering installing a charging station at your home or business, be sure to explore these options to see if you qualify.