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Federal

Used EV Tax Credit (25E) 2026: $4,000 on Used Electric Vehicles

The federal 25E Previously-Owned Clean Vehicle Credit pays 30% of sale price up to $4,000 toward a used EV — making this one of the most underused incentives in the country. The vehicle must be at least 2 model years old, sale price $25,000 or less, purchased from an IRS-registered dealer (not a private party), and the buyer must meet tighter income caps than 30D ($150,000 MFJ / $75,000 single). The credit is transferable to the dealer at point of sale, just like 30D — most buyers transfer to immediately reduce the down payment.

Vehicle Eligibility

Sale price $25,000 or less. At least 2 model years older than the year of purchase. First qualifying transfer since IRA enactment (Aug 2022) — once a vehicle has been claimed under 25E, no future 25E claim possible. Must be on fueleconomy.gov used EV list.

Dealer Requirements

The dealer must be registered with IRS Energy Credits Online. Private-party sales do not qualify. Verify before deposit — only registered dealers can issue 25E.

Income Caps

$150,000 MAGI married filing jointly, $112,500 head of household, $75,000 single. Half the 30D thresholds. Use lower of prior year or delivery year.

Transfer at Point of Sale

Same mechanic as 30D. Dealer files Form 15400 within 3 days. You sign and keep a copy. Credit applied immediately to sale price. Must report on Form 8936 with tax return.

Stacking with State Used-EV Programs

California, Massachusetts, and New York have state-level used-EV rebates that stack with 25E. Check state programs — these add $500 to $4,500 typical.

Frequently asked questions

What if the used EV had a previous 25E claim? +
Disqualified. 25E is per-VIN once across the vehicle lifetime since IRA enactment.
Can I claim 25E from a private-party sale? +
No. 25E requires an IRS-registered dealer transaction.
How often can I claim 25E? +
Once every three tax years.

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