Electric Vehicle Incentives by State (2024)

Electric cars are not just good for the environment. Buying one can put some extra cash in your pocket via tax credits or rebates.

Kim Porter
Written byKim Porter
Kim Porter
Kim Porter
  • Co-authored the book “Future Millionaires’ Guidebook”

  • 13 years writing personal finance content

A former chief copy editor at Bankrate and past managing editor at Macmillan, Kim specializes in writing easy-to-understand, actionable personal finance content.

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Courtney Mikulski
Courtney MikulskiSenior Editor, Auto
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Updated November 21, 2024

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If you own an electric vehicle or you’re buying one soon, you may qualify for programs that help you recoup the purchase price. The federal government provides an income tax credit of up to $7,500 for all-electric, plug-in hybrid, and fuel cell electric vehicles purchased before Jan. 1, 2023.[1] If you missed that cutoff, you may qualify for a whole new slate of federal tax breaks in 2023 and beyond.[2]

You may find programs for your state or city, as well. Many state and local governments, nonprofits, and utility companies offer tax credits and rebates to reward you for going green. Every program is different, so you’ll need to go through the details to see if you and your vehicle qualify. Here’s what to know before heading to the dealership.

Electric vehicle definitions

Some EV incentive programs restrict eligibility to certain types of cars, so it helps to understand some of the terms you may come across. Here’s a rundown of the major alternative-fuel vehicle types.

  • Alternative-fuel vehicles (AFVs) are cars that run on alternative fuel — such as electricity, biodiesel, or propane — rather than gasoline.

  • Battery-electric vehicles (BEVs) are powered with a battery and an electric motor.

  • Electric vehicles (EVs) use a battery and an electric motor, and they include battery electric vehicles (BEVs) and plug-in hybrid electric vehicles (PHEVs). 

  • Plug-in hybrid electric vehicles (PHEVs) run on a combination of gasoline and electricity, so a battery and an electric motor in addition to a gasoline tank and an internal combustion engine power the car.

  • Fuel-cell electric vehicles (FCEVs) use pure hydrogen gas stored in a tank inside the vehicle. These cars produce zero tailpipe emissions.

  • Zero-emission vehicles (ZEVs) use alternative fuel sources, so they don’t produce greenhouse gas emissions and pollutants.[3]

Keep in Mind

When you own an electric vehicle, you may also need electric vehicle supply equipment (EVSE), also known as charging stations, to recharge its batteries.

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Hybrid and electric vehicle incentives by state

The table below outlines the incentives you may receive when you purchase or lease an electric vehicle. Some are available at the state level, while others are through local nonprofits and utility companies. Many utility companies also offer rebates, bill credits, or other incentives for installing an EV charger. Customers can also typically receive “time of use” rates, which are discounted rates for charging during off-peak hours.

These perks may change over time, and this list is not exhaustive. If you don’t see a relevant incentive listed here, check with your state or local government or utility company for a list of savings options.

State
Electric Vehicle Incentive
Alabama
  • Alabama Power offers discounted time-of-use rates for charging an EV during off-peak hours.
Alaska
Arizona
Arkansas
California
Colorado
  • Statewide tax credit between $1,500 and $8,000 for purchasing or leasing an EV or PHEV. 
  • Gunnison County Electric Association customers may receive rebates for buying an EV, installing a qualifying EV charger, and signing up for time-of-use rates. They may also borrow an EV for up to seven days at no cost and with no mileage restrictions.
Connecticut
  • Statewide rebate of up to $9,500 for purchasing or leasing a qualifying EV or hydrogen FCEV. 
  • Eversource provides rebates for qualifying EV chargers. 
  • Norwich Utilities customers receive a rebate of up to $1,000 for purchasing or leasing an EV and an additional rebate for installing a qualifying charger, for $5,000 total.
Delaware
  • Statewide rebate of up to $2,500 for buying or leasing a qualifying EV before April 30, 2023. 
  • Delmarva Power customers get special time-of-use rates when they own an EV.
  • Delaware Electric Cooperative provides a $200 bill credit rebate and a $5 monthly bill credit for charging during off-peak hours.
Florida
Georgia
  • Georgia Power customers receive a special rate when charging during off-peak hours.
  • Cobb EMC customers receive an incentive after installing a qualifying EV charger.
Hawaii

 

  • Hawaiian Electric offers special rates for charging during off-peak hours for Oahu, Molokai, Maui, and Hawaii Island customers.
Idaho
  • Residents are exempt from state motor vehicle inspection and maintenance programs when they own EVs, PHEVs, and hybrid electric vehicles.
Illinois
Indiana
Iowa
  • No incentives or programs available for private EV owners.
Kansas
  • Statewide tax credit of up to $2,400 per EV and other AFV you purchase.
  • Evergy customers may receive a rebate when purchasing a qualifying EV charger and signing up for time-of-use rates.
Kentucky
  • No incentives or programs available for private EV owners.
Louisiana
Maine
  • Statewide rebate between $1,000 and $7,500 when you buy a qualifying BEV or PHEV.
Maryland
  • Beginning July 2023, residents can qualify for a statewide excise tax credit of up to $3,000 for purchasing a qualifying EV or FCEV. 
  • Some utility companies offer rebates for installing qualifying EV chargers, and they may offer incentives for charging during off-peak hours.
Massachusetts
  • Statewide rebate of $3,500 for purchasing eligible BEVs, FCEVs, and PHEVs.
  • Some utility companies may offer a rebate for purchasing a qualified EV charger. 
Michigan
  • Some utility companies offer rebates for installing a qualifying EV charger, along with special time-of-use rates. 
  • Presque Isle Electric & Gas Co-Op customers receive a rebate of up to $1,500 when purchasing a new or used EV, and a $600 rebate for purchasing and installing a qualifying charging station.
Minnesota
  • Some utility companies offer rebates for installing a qualifying EV charger, along with special rates for charging during off-peak hours. 
  • Xcel Energy also offers incentives for owning an EV.
Mississippi
Missouri
Montana
  • No incentives or programs available for private EV owners.
Nebraska
  • Nebraska Public Power District and Southern Public Power District provide rebates of up to $4,000 when you purchase a new EV in Nebraska.
  • You may also receive a rebate for installing a qualifying EV charging station.
Nevada
  • NV Energy offers a special rate for charging your EV during off-peak hours.
New Hampshire
  • New Hampshire Electric Co-op customers can receive a combined rebate for purchasing or leasing a new or used EV and installing an EV charger.
New Jersey
  • Statewide exemption from paying state sales and use taxes on zero-emission vehicles, including EVs and plug-in electric cars.
  • Statewide incentive of up to $4,000 for purchasing or leasing new, eligible BEVs.
  • Some utility companies offer rebates for installing qualifying charging stations.
New Mexico
New York
  • Statewide rebate of up to $2,000 for purchasing or leasing an eligible EV.
  • Statewide income tax credit for 50% of the cost of installing alternative fueling infrastructure, up to $5,000. 
  • ConEd and Central Hudson offer incentives for installing qualifying EV chargers.  
North Carolina
  • Duke Energy customers can receive a one-time credit of up to $1,133 to help cover the costs of preparing your home for an electric vehicle charger. 
  • Some utility companies provide incentives for installing a qualifying EV charger and special time-of-use rates.
North Dakota
  • No incentives or programs available for private EV owners.
Ohio
Oklahoma
Oregon
  • Oregon’s Clean Vehicle Rebate Program provides rebates of up to $2,500 for purchasing or leasing a BEV or PHEV.
  • Another rebate of up to $5,000 is available for residents who meet income requirements.
  • Central Lincoln and Eugene Water & Electric Board offer incentives for installing a qualifying EV charger.
  • Other utility companies provide incentives for installing a qualifying EV charger.
Pennsylvania
  • Through June 30, 2023, residents who meet income requirements may qualify for a statewide rebate of up to $2,000 for purchasing certain electric vehicle types.
  • PECO Energy customers can receive a $50 rebate for purchasing a new, qualified EV.
  • Duquesne Light Company offers a one-time $60 bill credit to customers who purchase or lease an EV.
Rhode Island
  • Statewide rebate of up to $2,500 for purchasing or leasing a new or used BEV or FCEV and up to $1,500 for purchasing or leasing a new PHEV.
South Carolina
  • Santee Cooper customers can receive a rebate of $250 for installing an EV charger and special rates when charging the vehicle.
South Dakota
  • Black Hills Energy customers may receive a rebate of up to $500 for installing an EV charger.
Tennessee
  • Knoxville Utility Board customers can apply for a $400 rebate for purchasing and installing a qualifying EV charger.
Texas
  • Some utility companies offer rebates for purchasing or installing a qualifying EV charger.
Utah
  • Rocky Mountain Power offers a rebate for installing a qualifying EV charger.
Vermont
  • Statewide incentive of up to $8,000 for purchasing a new or used eligible electric vehicle.
  • Utility companies across the state also offer incentives for purchasing or leasing an EV and for installing a qualifying charger.
Virginia
  • Some utility companies provide incentives to customers who own EVs — through rebates, time-of-use rates, or bill credits.
Washington
  • Statewide sales and use tax exemption for buying or leasing a new or used EV.
  • Utility companies provide incentives to customers who own EVs — through rebates, time-of-use rates, or bill credits.
Washington, D.C.
  • Residents may qualify for an income tax credit of 50% of the costs of purchasing and installing an EV charging station and 50% of the costs to convert alternative fuel vehicles, up to $19,000 per vehicle.
  • Utility company Pepco also offers a $50 annual incentive for installing a qualified EV charger.
West Virginia
  • Appalachian Power offers an incentive for purchasing or installing a qualifying charger.
Wisconsin
Wyoming
  • Black Hills Energy customers receive a $500 rebate for purchasing and installing a qualifying EV charging station.

States with the best EV incentives

While federal incentives for electric vehicles may be available for anyone in the country, the following states offer more reasons for drivers to switch to EVs.

California 

No matter where you live in California, you’re bound to qualify for some type of incentive, rebate, or discount for purchasing, leasing, or owning an electric vehicle. On the state level, the Clean Vehicle Rebate Project provides rebates of up to $7,500 for BEVs and FCEVs and up to $6,500 for PHEVs. And through the California Air Resources Board, applicants can receive grants of up to $5,000 to partly cover the costs of buying an EV or PHEV. Eligibility for both programs is based on income.

Utility companies and nonprofits throughout the state have their own rebate programs, too. For example, the Bay Area Air Quality Management District offers a rebate of up to $9,500 for income-qualifying residents who retire an older car and replace it with a new, qualifying vehicle. Some insurance companies offer policy discounts for owning an EV in California, and some local governments provide free metered parking or free charging stations for electric vehicles.

Vermont

Through the Vermont Drive Electric program, residents can receive up to $4,000 for purchasing a new eligible EV or up to $5,000 for buying a used high-efficiency vehicle. The amount depends on the type of EV (plug-in hybrid or all-electric), filing status, and income level. You can either claim the incentive directly at a participating auto dealer or by filling out an application.

In addition to the Drive Electric initiative, you may qualify for $3,000 through Vermont’s Replace Your Ride program and cash incentives through your local utility company. You can estimate your potential rebate by using an incentive calculator.

Connecticut

Connecticut residents may qualify for a cash incentive through the Connecticut Hydrogen and Electric Automobile Purchase Rebate Program (CHEAPR) when they buy or lease a battery electric vehicle, fuel-cell electric vehicle, or plug-in hybrid electric vehicle.

You’ll first need to choose an eligible vehicle from a licensed Connecticut automobile dealership or the original manufacturer, and the car’s base MSRP can’t exceed $50,000. The standard rebate is worth $750 to $7,500, based on the EV type you purchase, and income-qualified residents may receive a higher rebate of $2,250 to $9,500.

Oregon 

The Clean Vehicle Rebate Program provides rebates to Oregon residents who purchase or lease a battery-powered or plug-in hybrid electric vehicle. The incentive starts at $750 for zero-emission motorcycles and goes up to $2,500 for electric cars, though some income-eligible residents could qualify for a rebate of up to $7,500. To claim the rebate, you need to submit an application no longer than six months after buying the vehicle. 

Maine

Through the Efficiency Maine program, state residents can receive a rebate of up to $7,500 for purchasing a battery electric vehicle or plug-in hybrid electric vehicle. You can either buy the car from a participating dealership, which will automatically reduce the price, or purchase directly from the manufacturer and later submit an application. The vehicle must be new, though income-eligible drivers may purchase a qualifying used electric vehicle.

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Electric vehicle incentives FAQs

Here are answers to some commonly asked questions about electric vehicle tax and rebate incentives.

  • How do you claim your 2023 EV tax credit?

    Federal EV tax credits are available to people who buy a new plug-in electric vehicle or fuel cell vehicle from a qualified manufacturer.[4] Starting in tax year 2023, the credit is worth up to $7,500 for new EVs and up to $4,000 — limited to 30% of the sale price — for used EVs. You need to meet income requirements to qualify. Married couples filing jointly may earn up to $300,000 per year, heads of households can earn up to $225,000 per year, and all other tax filers can earn up to $150,000 annually for eligibility.

  • What states have the most EV incentives?

    California, Vermont, Connecticut, Oregon, and Maine all offer rebates of $7,500 or more when you buy or lease a qualifying electric vehicle and follow program requirements. Depending on the program, the car may be new or used.

  • Does Florida offer incentives for electric cars?

    Florida doesn’t have incentives for private residents buying an electric car, but several local utility companies offer bill credits or discounted rates to residential customers who charge their electric vehicles during off-peak hours and small rebates for buying electric vehicles.[5]

  • How do tax incentives work for electric cars?

    To claim the federal tax credit, you need to include Form 8936 when you file your federal income tax return. This form also helps you determine your eligibility for federal tax credits.

  • Which state has the most electric cars?

    As of the end of 2021, California was the state with the most electric vehicles in the U.S., with 39% of EVs nationwide.[6] Florida has the second-highest count of EVs, followed by Texas.

Sources

  1. U.S. Department of Energy. "Federal Tax Credits for New All-Electric and Plug-in Hybrid Vehicles Purchased before 2023."
  2. Internal Revenue Service. "Credits and Deductions Under the Inflation Reduction Act of 2022."
  3. National Conference of State Legislatures. "State Policies Promoting Hybrid and Electric Vehicles."
  4. Internal Revenue Service. "Credits for New Clean Vehicles Purchased in 2023 or After."
  5. Alternative Fuels Data Center. "Florida Laws and Incentives."
  6. Alternative Fuels Data Center. "Electric Vehicle Registrations by State."
Kim Porter
Kim Porter

Kim Porter is a writer and editor who's been creating personal finance content since 2010. Before transitioning to full-time freelance writing in 2018, Kim was the chief copy editor at Bankrate, a managing editor at Macmillan, and co-author of the personal finance book "Future Millionaires' Guidebook." Her work has appeared in AARP's print magazine and on sites such as U.S. News & World Report, Fortune, NextAdvisor, Credit Karma, and more. Kim loves to bake and exercise in her free time, and she plans to run a half marathon on each continent.

Courtney Mikulski
Edited byCourtney MikulskiSenior Editor, Auto
Courtney Mikulski
Courtney MikulskiSenior Editor, Auto
  • 3+ years producing insurance and personal finance content

  • Main architect of the Insurify Quality Score

Courtney’s deep personal finance knowledge extends beyond insurance to credit cards, consumer lending, and banking. She thrives on creating actionable content.

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