§25E Previously-owned Clean Vehicles

Summary

You can get a tax credit when you put a previously‑owned clean vehicle into service during the year. The credit is the smaller of $4,000 or 30% of the vehicle’s sale price. You cannot get the credit if the smaller of your modified adjusted gross income this year or last year is above the threshold: $150,000 for joint returns or surviving spouses, $112,500 for head of household, and $75,000 for others. Modified adjusted gross income means your adjusted gross income plus amounts excluded under sections 911, 931, or 933. A “previously‑owned clean vehicle” must be at least two model years older than the year you buy it, originally used by someone else, bought in a “qualified sale,” and meet the technical clean‑vehicle rules in section 30D(d)(1) or the rules in 30B(b)(3) with a gross vehicle weight rating under 14,000 pounds. A “qualified sale” is by a dealer, for $25,000 or less, and is the first transfer since this rule started to a qualified buyer who is not the original user. A “qualified buyer” is an individual who buys for use (not resale), does not allow a dependent deduction for another taxpayer, and has not received this credit for any sale in the prior 3 years. You must put the vehicle identification number on your tax return. Rules like those in sections 30D(f) and 30D(g) apply. No credit is allowed for vehicles acquired after September 30, 2025.