How to Understand Hybrid and EV Incentives

One way the government makes it easier to switch from a gasoline vehicle to a hybrid or electric vehicle (EV) is through incentives. If you're buying a new car, it's essential to take seriously the options provided by hybrid and EV incentives. They can make purchasing a Lexus hybrid or EV a better option and allow you to transition to a more sustainable and efficient motor vehicle.

What Are Hybrid and EV Incentives?

Federal incentives come in the form of tax credits on federal income tax. The vehicles themselves are still licensed and taxed, but an individual who buys a qualifying hybrid or EV receives a tax credit for the year they made the purchase. The highest amount awarded under the current federal tax credit program is $7,500 for a qualifying hybrid or EV.

There are levels of tax credit based on which criteria the hybrid or EV qualifies for. For example, a hybrid Lexus ES 300h may be eligible for tax credits up to $7,500.

What Hybrids and EVs Qualify for Which Incentives

Like any automotive legislation, the system for federal tax credits on hybrids and EVs - such as ones you can buy from our Lexus dealership near Santa Clarita - can seem complex. The amount of credit is calculated based on the vehicle's battery pack size. That being the case, hybrids usually qualify for fewer tax credits than EVs.

To meet the criteria, the vehicle in question must be:

• A road-going vehicle intended for US roads
• Purchased, not leased
• Bought as a new - not used - car
• Equipped with a battery pack with a capacity of 4 kWh or more

Additional information to remember is that tax credits on a specific model are phased out once the manufacturer has sold 200,000 units of that model.

Additional Incentives

Federal incentives aren't the only ones available. State incentives can also come into play when you purchase an EV or hybrid. Utility companies can also provide incentives for hybrid and EV buyers to claim credits or cash back on utility bills. Your Lexus dealer will help you identify and capitalize on these opportunities.

Hybrid Buying Options at Lexus of Valencia

If understanding how hybrid and EV incentives work has sparked an interest in browsing a selection of electric-powered vehicles, don't hesitate to visit us at Lexus of Valencia. We have a comprehensive inventory of premium models that qualify for tax credits and provide great options for a first-time hybrid or EV buyer. We also offer Lexus service that helps keep your vehicle running its best!