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New Guidance on Tax Credits for EV Charging Stations

The adoption of electric vehicles (EVs) has been on the rise in recent years as more individuals and businesses recognize the environmental and economic benefits they offer. To support this transition, the government has introduced various incentives, including tax credits for EV charging stations. In this blog post, we will explore the latest guidance provided in Notice 2024-20, which outlines the eligibility criteria and requirements for claiming tax credits related to EV charging infrastructure.



EV Charging Station

Overview of Notice 2024-20:

Notice 2024-20, issued by the Internal Revenue Service (IRS), provides comprehensive guidance on the tax credits available for EV charging stations. The notice clarifies the rules and requirements for claiming the credit, ensuring that taxpayers can take full advantage of the incentives provided.


Eligibility Criteria:

To be eligible for the tax credit, EV charging stations must meet certain criteria outlined in Notice 2024-20. These criteria include:

1. Station Type: The charging station must be a qualified station, which includes Level 2 charging stations and DC fast charging stations. Level 1 charging stations are not eligible for the tax credit.


2. Installation Date: The station must be installed and placed into service after December 31, 2021, and before January 1, 2027, to qualify for the tax credit.


3. Networked Stations: The charging station must be networked and accessible to the public. This requirement ensures that the tax credits incentivize the expansion of public charging infrastructure.


Tax Credit Amount:

The tax credit amount for eligible EV charging stations is determined based on the station's power capacity. Notice 2024-20 provides the following breakdown:

1. Level 2 Charging Stations: For stations with a power capacity of at least 7.2 kilowatts (kW) but less than 15 kW, the tax credit amount is $1,000 per station. If the power capacity is 15 kW or more, the tax credit amount increases to $2,500 per station.


2. DC Fast Charging Stations: For stations with a power capacity of at least 50 kW, the tax credit amount is $30,000 per station. If the power capacity is 100 kW or more, the tax credit amount increases to $50,000 per station.


Claiming the Tax Credit:

To claim the tax credit for EV charging stations, taxpayers must file Form 8911, Alternative Fuel Vehicle Refueling Property Credit, with their annual tax return. The form requires taxpayers to provide information about the charging station, including its power capacity and installation date.


It is important to note that the tax credit is non-refundable, meaning it can only be used to offset tax liability. However, any unused portion of the credit can be carried forward to future tax years.


The new guidance provided in Notice 2024-20 offers valuable information for individuals and businesses interested in installing EV charging stations. By taking advantage of the tax credits available, taxpayers can not only contribute to the expansion of public charging infrastructure but also reduce their tax liability. As the adoption of electric vehicles continues to grow, these incentives play a crucial role in promoting sustainable transportation options and reducing greenhouse gas emissions.

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