Up to $7,500 Savings: U.S. Treasury and IRS Finalize Electric Vehicle Tax Credit Rules, Supporting President Biden’s Plan for EV Adoption

U.S. Treasury and IRS finalize EV tax credit rules to boost Biden’s plan despite criticism over strict standards and concerns about favoring Chinese products.

U.S. Treasury and IRS Finalize Electric Vehicle Tax Credit Rules to Boost President Biden’s EV Adoption Plan

The U.S. Treasury and IRS have finalized federal electric vehicle (EV) tax credit rules. Released on May 3, they are part of President Biden’s plan to encourage people to use electric cars in the country. They try to balance supporting EV use while protecting American interests, according to Kiplinger’s report.

Treasury Secretary Janet Yellen praised the rules for helping American manufacturing and energy security. IRA, a law passed a few years ago to tackle climate change and energy issues. Yellen mentioned that the IRA’s clean vehicle credits could save buyers up to $7,500 on a new EV, create jobs and make the country more energy-independent.

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(photo: CNET)

U.S. Finalizes EV Tax Credit Rules Amid Criticism

Rules keep strict standards, so only about 20% of electric models qualify for the tax credit. They say cars mainly using minerals from other countries or linked to the Chinese government can’t get the credit. This is to reduce dependence on foreign suppliers, but it has faced criticism.

Senator Joe Manchin criticized parts of the rules, calling them “outrageous and illegal.” He thinks they favor products made in China and might have loopholes. Other lawmakers, like Senators Kevin Cramer and John Barrasso, also want to change some EV tax credits.

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Furthermore, the regulations aim to strike a balance between promoting the adoption of electric vehicles and safeguarding American interests.