Treasury rule would expand tax credits for installing electric vehicle chargers
WASHINGTON (AP) — The Biden administration is moving to clarify how homeowners and businesses can receive lucrative tax credits for installing electric vehicle chargers.
A rule proposed Wednesday by the Treasury Department would make credits worth up to $1,000 for individuals and $100,000 for businesses available for each EV charger that is installed. If finalized, the new rule would be especially valuable to businesses that plan to install multiple chargers and would be eligible for significant credits to offset the expense.
“In order to help more Americans go electric, we need to make sure they can charge their EVs where they live, work and shop – from inner-city neighborhoods to rural areas,” said John Podesta, White House senior advisor for international climate policy. The 2022 Inflation Reduction Act is expanding charging access by saving families and businesses up to 30% off the cost of installing EV chargers, he said.
The proposal announced Wednesday follows guidance issued in January that made tax credits for installing EV chargers available in about two-thirds of the country. The guidance responded to a directive from Congress in the climate law to ensure that the credits for EV chargers are limited to low-income or non-urban areas.
Treasury chose an expansive definition for census tracts covered by those terms to include about two-thirds of the country. The guidance issued in January did not address exactly which parts of an EV charging installation are eligible for the credit. The plan announced Wednesday again opts for an expansive definition — targeting individual charging ports rather than a single credit for a multi-port installation.
Advocates have said the tax credits could play a significant role in expanding use of EVs and reducing pollution from the transportation sector, which accounts for the single-largest source of U.S. climate-warming emissions.
“We appreciate the Treasury’s movement on this important incentive, which will help ensure that Americans can benefit from the electric vehicle” provisions of the 2022 climate law, said Katherine García, director of the Sierra Club’s Clean Transportation for All program.
Together with other EV provisions in the climate law and the 2021 bipartisan infrastructure law, “this charging incentive will accelerate the transition to clean vehicles, create good-paying jobs and help our nation meet our climate and clean-air goals,’' Garcia said.
Congress approved $7.5 billion in the 2021 infrastructure law to meet President Joe Biden’s goal to build a national network of 500,000 publicly available chargers by 2030. The public charging ports, along with a network of private ports, are crucial to the Biden-Harris administration’s effort to encourage drivers to move away from gasoline-powered cars and trucks that contribute to global warming.
There are over 192,000 publicly available charging ports nationwide as of late last month, the Transportation Department said — more than double the amount in January 2021 when Biden took office.
The new tax credit will be particularly valuable to communities living near warehouses, who are often exposed to toxic vehicle pollution from gas-powered delivery trucks that pass through their neighborhoods every day, Garcia said, adding that the tax incentives should be particularly attractive for warehouse owners to install EV chargers for thousands of commercial delivery trucks across the U.S.
Albert Gore, executive director of the advocacy group Zero Emission Transportation Association, said the new tax plan would boost the use of chargers where people live and work.
“One of the great things about driving an EV is that drivers can charge while their vehicle is parked, rather than adding another errand to their busy day,’' said Gore, the son of former Vice President Al Gore.
The alternative-fuel vehicle tax credit, known as “30C” for its location in the U.S. tax code, is designed to provide an incentive for individuals and businesses to build charging infrastructure in homes, businesses and retail locations. “By issuing this proposed rule, Treasury and the IRS are beginning to provide the regulatory certainty needed to move these investments forward,’' Gore said.
The proposed rule will be open for public comment until mid-November, and a public hearing will be scheduled if requested. A Treasury spokesman declined to say when the rule would become final.
Disclaimer: The copyright of this article belongs to the original author. Reposting this article is solely for the purpose of information dissemination and does not constitute any investment advice. If there is any infringement, please contact us immediately. We will make corrections or deletions as necessary. Thank you.
