Share this update with residents and businesses before the deadline
CHICAGO (Sept. 4, 2025) – The federal tax credits for electric vehicles (EVs) will expire on Sept. 30, 2025. Act quickly to take advantage of the tax credits through elective pay for your fleet, and inform residents and businesses in your community about this opportunity.
Your residents can still purchase an EV by Sept. 30, 2025, and potentially receive a tax credit of up to $7,500 for new EVs and $4,000 for used EVs.
For those who plan to purchase an EV soon, please confirm eligibility with your dealership, manufacturer, and by reviewing the below IRS guidance before the Sept. 30, 2025, deadline. Some of the current requirements relate to the buyer’s income, the cost of the EV, the location of manufacturing/assembly, and the source of the battery’s minerals.
The Commercial Clean Vehicle Tax Credit will also end on Sept. 30, 2025. This credit allows businesses or local governments through elective pay to qualify for up to $7,500 for passenger vehicles and up to $40,000 for vehicles 14,000 pounds or more. In comparison to the personal EV tax credit, there are fewer restrictions on the Commercial Clean Vehicle Tax Credit, in terms of price cap or sourcing requirements. For more information on how elective pay, or direct pay, to local governments works before this tax credit expires, please see our past Environment Committee meeting resources on the topic.
Guidance on Eligibility
For more details on eligibility for any of the EV tax credits, go to the IRS Clean vehicle tax credits webpage.
Please also review additional eligibility guidance, which was released by the IRS on Aug. 21, 2025. Please note that question two of the guidance states, “… a vehicle is ‘acquired’ as of the date a written binding contract is entered into and a payment has been made.”
