Summary
- Get a 30% used-EV tax credit (max $4,000) on cars ≤$25K expires Oct 1, 2025.
- You should buy from a certified dealer; income, model-year, and prior-credit limits apply.
- Used EVs offer big savings and battery warranty peace, so act before credits push prices up.
Right now, you can get a 30% tax credit (up to $4,000) on a used EV. That means buying a low-mileage 2024 Nissan Ariya costing $23K for $19K, or paying $15K for a $19K ’23 Chevy Bolt. This goes away on October 1, 2025.
We all know of the $7,500 tax credit on new EVs ending, but the break on used EVs is as big a deal, if not bigger. This tax credit is slightly complicated, but I’ll unpack the what and how of it in simple terms, plus give you a couple of good links if you want to get into the weeds.
I’ll briefly touch on why and when a used EVs is such a good idea, and pull a couple of actual offers now on Edmunds, which my go-to site for everything about cars. September is going to fly by before you know it, so it’s going to be crucial to act fast.
How the used EV tax credit works
Several criteria, but not that difficult
You can get a 30% tax credit on a used EV selling for $25K or less, up to $4,000. This credit can be used to lower the purchase price at the dealer, or you pay the full price and claim the credit at the end of the financial year. Yeah, right.
Beside the maximum price, there are also several other criteria that have to be met to quality for the rebate. I’m going to give you the potted version, but $4K is a significant chunk of money, so I suggest you check with the IRS before you sign on the dotted line, although you can only do this through a dealer, who should have a strong interest in both you and the vehicle you’re buying qualify for the credit.
Buyer qualifications
To qualify for this credit, you must:
- Be an individual who is buying the vehicle for use and not for resale
- Be an individual, not a business
- Not be the original owner — you cannot sell it to yourself
- Not be claimed as a dependent on another person’s tax return
- Not have claimed another used vehicle credit in the 3 years before the purchase date
- Modified adjusted gross income not exceeding $75k for individuals, $112,500 for heads of households, and $150k for joint returns
Used car attributes
To qualify for the tax credit, the car has to:
- Have a sale price of $25,000 or less
- Be a model year at least two years earlier than the calendar year when you buy it, so a 2023 model in 2025
- Not have already been transferred to a qualified buyer after August 16, 2022
- Have a gross vehicle weight rating of less than 14,000 pounds
- Be an eligible EV, plug-in hybrid or fuel-cell vehicle with a battery capacity of least 7 kWh
- Be for use primarily in the United States
- Purchased from a certified dealer, who has to report the sale to IRS
- A used vehicle qualifies for tax credit only once in its lifetime
Why used EVs are so popular
Depreciation and balance of battery warranty
EVs depreciate very quickly over the first few years of their life. The main reasons are that the technology behind them is developing so fast, and battery prices are dropping so rapidly, that a new EV will be outdated in two years’ time. If you can buy a better EV for less than you paid two years ago, used prices will have to go down.
At the same time, that two-year-old EV may be dated in EV terms, but is still red-hot advanced technology compared to any gas or even hybrid car on the road today.
Battery warranty
EVs are mechanically very simple compared to other cars. There is very little that can go wrong in a particularly expensive way. The main cost of an EV is the battery pack, and that would be very expensive to replace or repair.
But EV batteries come with very chunky battery warranties, usually eight years, but sometimes up to ten years. So if you buy a three-year-old EV, you still have 5 years of warranty peace of mind right there. The average new gas car comes with a three-year/36,000-mile warranty, so your used EV warranty has legs gas cars simply cannot match.
While a factory warranty is as good as gold, you can really seek better deals on older EVs as well. A recent study at Stanford found that EV batteries would last 40% longer than anticipated when warranties were formulated.
Used EV examples
Prices now and in October
Used EV prices are already going up, and I can see that sub-$25K slot getting crowded as we get closer to October. Used EVs will still be a good option, even with the tax credit gone, but if you can cut $4,000 off now, why wait?
To give you an example of what prices will be in October versus right now, I went to Edmunds to search for used EVs in my area. I have no affiliation with the car shopping guide — I find it to be a useful tool to showcase examples of this scenario. You can look around at sites like Kelly Blue Book, JD Power, or businesses local to your area.
When I checked local listings, I found three used EVs that will each see a $4,000 price bump come October. Listings, of course, change constantly as cars sell or get pulled, so these are just snapshots meant to give you an idea of what to expect. Still, they serve as useful examples of how the market shift could play out across the US.
2019 Audi e-tron $25K ($21K after tax break)
The first result I saw was this luxury German SUV — it was just shy of a 200-mile range, had one owner, experienced no accidents, and had just 36,000 miles on the clock. Sure, you can get a new gas econobox for the same price, but have you ever driven an Audi? It is large, there is a lot of leather, the doors close with a ‘clunk’ sound. Need I say more?
2023 Nissan Leaf $16K ($12K after tax break)
The Leaf is a small hatch with just over 150 miles of range, which sounds very low, until you consider the following. The average US motorist drives 37 miles per day, including the daily commute. Home charging an EV costs about 75% less than filling up with gas for a similar range.
The Leaf was the first affordable EV back in 2010, and the modern version is still geared to this. Despite its low price, the Leaf has a decent cabin, with a nice touchscreen, Apple and Android connectivity, and good safety features.
The particular listing I found had one owner, no accidents, and only 6,500 miles on the clock. This is unbeatable value if you are looking for a practical, affordable daily drive.
2023 Kia Niro EV $24K ($20K after tax break)
The Kia Niro EV is a small crossover SUV with funky good looks, and comes loaded with tech. A new one will start at $40K. The particular listing I saw had over 250 miles of range and came with a 10-year/100,000-mile powertrain warranty. This one had 39,000 miles, so still eight years and 60,000 miles of peace of mind.
There are loads of great used EVs for sale nationwide, but the most important thing is to keep the deadline top of mind.
