The Federal Electric Vehicle (RE Valencia) tax credit program is designed to reward EV owners for making the switch to a greener and more fuel efficient vehicle. There are several things you should know about the program before applying. There is an annual federal filing deadline. Before you apply, read the guidelines and instructions. Filing electronically is the most convenient way to submit your tax returns.

Even if you qualify, the federal Qualified Plug-In Hybrid Electric Drive Electric Vehicle Tax Credit can provide you with as much as $7,500 if you qualify. And depending upon where you live, you might also qualify for other state, local and utility-companies incentives, such as discounts and rebates. The amount of your rebate or discount will vary by the state and type of electric vehicle you drive. Most importantly, however, your ability to make “free” electricity in your home is still a major consideration.

In general, tax credit applications for plug-in hybrid vehicles and all-electric vehicles are reviewed on two principal criteria: first, the amount of fuel used for driving the vehicle and second, your income and driving history. If you plan to buy an electric vehicle, you must confirm that you meet the eligibility requirements. Some states, such as California, do not require vehicle ownership for you to qualify. Others, such as Massachusetts and New York, require vehicle ownership to be completed before you can receive a federal income tax credit or deduction. If your state requires vehicle ownership, be sure to complete all necessary paperwork before submitting your application. This includes, among others, copies of your current gas bill, proof of insurance, and a copy of your vehicle registration certificate.

If you plan to buy a used or inexpensive electric vehicle, the first thing you should do is look for dealers offering rebates on the models you want. There are various rebates available, depending on model and size. In general, the more costly your vehicle is, the greater your rebate. For most buyers, this translates into significant savings.

The second step is to review the federal electric vehicle tax credit schedule. Each calendar quarter, the US Department of Energy distributes an updated version of the schedule. You can download the schedule from their website. To get the most recent schedule, log on to their website and select the “vehicle Availability” drop down menu.

Be aware that the calendar quarter date is not the only time when you will qualify for tax incentives. Incentive amounts are also given out for the first year that sales of qualifying electric vehicles (PVH) occur. For example, a tax credit incentive will be offered for manufacturers who bring new, certified zero-emission vehicle sales to the public. The date you submit your application can have an impact on the date you receive your incentives. If you intend to purchase a new or used vehicle in the future, it may be better to wait until your rebate is granted.

To determine which rebates you will be eligible for, you should visit the EV Tax Credit site. Here, you will find detailed information on federal government rebates for electric vehicles and other fuel-efficient technologies. All rebates are subject to change, so it is important that you keep up with what the government is offering. If you meet the criteria for one rebate but not another, you won’t be eligible for another. Keep in mind that the rebate amount is figured based on your zip code and market area.

Be aware that even if you meet all the requirements for one federal tax credit, you will not qualify for all others. Some areas, such as for manufacturers and suppliers, may not offer rebates at all. You will want to check with your local gas station or car wash to see if they are offering rebates for electric vehicle tax credits. Also, manufacturers and suppliers may qualify for a credit in several states but not for all states. For example, General Motors received a credit for making an all-electric small car but did not qualify for a rebate in Wisconsin.