The Clock Is Ticking For EV Tax Credits
President Donald Trump has signed the “Big Beautiful Bill” into law, and among its far-reaching provisions is the elimination of all current federal tax credits for new and used electric vehicles.
Key Points
- President Trump’s newly signed “Big Beautiful Bill” eliminates the federal EV tax incentives—up to $7,500 for new and $4,000 for used EVs—effective after September 30, 2025.
- Without these credits, analysts estimate EV adoption could drop from a projected 48% of car sales by 2030 to 37%, though increasing model affordability may offset some of the decline.
- Automakers like Slate Auto are already adjusting pricing assumptions, and many EVs could become more expensive after the credit cutoff—making the next three months crucial for buyers looking to save.
That means the current incentives—up to $7,500 off new EVs and $4,000 for eligible used models—will officially expire after September 30, 2025.
Since the Inflation Reduction Act of 2022, buyers of EVs that met a list of eligibility criteria—including North American final assembly, battery component sourcing, price caps, and weight limits—could claim a $7,500 tax credit. Used EV buyers were also able to claim a $4,000 credit if the vehicle met specific age and price requirements.
While the new bill includes incentives of its own, such as a tax deduction on car loan interest for new vehicles built in the U.S., it simultaneously phases out the credits that helped underpin EV adoption over the past several years.
While the long-term cost curve for EVs is still trending downward—thanks to improved manufacturing and battery tech—prices could increase in the short term. It shouldn't stop people from shopping for EVs, especially those who are committed to the choice.
Slate Auto, a new startup backed by Jeff Bezos, has already walked back its sub-$20,000 price promise for its upcoming electric truck, citing the now-lost assumption that federal credits would help make that figure viable. Still, the number of affordable electric models continues to grow. In 2022, just 11 EVs were priced under $47,500. Today, that number is up to 19.
Consumers still interested in locking in the federal subsidy should act fast. After September 30, that's it, that's all—at least for now.
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An experienced automotive storyteller and accomplished photographer known for engaging and insightful content. Michael also brings a wealth of technical knowledge—he was part of the Ford GT program at Multimatic, oversaw a fleet of Audi TCR race cars, ziptied Lamborghini Super Trofeo cars back together, been over the wall during the Rolex 24, and worked in the intense world of IndyCar.
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Idealogically motivated decisions of one person affecting entire industries. Insanity.