Preparers completing Form 8936, Clean Vehicle Credits, need to determine if the vehicle the taxpayer has purchased is eligible for the credit, whether as a new clean vehicle or as a previously owned clean vehicle.
The Form 8936 instructions outline the requirements for a vehicle to qualify as a new clean vehicle:
- A battery capacity of at least 7 kilowatt hours.
- Manufactured primarily for use on public streets, roads, and highways (such vehicles have a vehicle identification number, or VIN);
- Gross vehicle weight rating (GVWR) of less than 14,000 pounds;
- Final assembly within North America by a qualified manufacturer;
- MSRP of not more than $55,000 for an automobile, or $80,000 for a van, SUV, or pickup truck.
When an individual purchases a clean vehicle from a dealer, the dealer should provide them with Form 15400, Clean Vehicle Seller Report. This report is also known as the "Time of Sale Report" and generally evinces that a vehicle qualifies for the clean vehicle credit. A taxpayer who hasn't got this report for the vehicle they purchased is probably not eligible for a clean vehicle credit, but you can also do your own due diligence to determine the vehicle's potential eligibility.
Whether it's a new clean vehicle or a previously owned clean vehicle, the vehicle's eligibility can be confirmed by year, make, and model by searching for it at fueleconomy.gov:
New Clean Vehicle
fueleconomy.gov Previously Owned
fueleconomy.gov
The VIN's eligibility can be confirmed at energy.gov:
energy.gov
Confirm the year, make, and model are eligible by clicking the appropriate fueleconomy.gov button and use their search tool to see if the vehicle is listed. If it's not listed, it's not eligible. Likewise, search for the VIN at energy.gov. If the VIN indicates final assembly was not in North America, the vehicle is not eligible.
Note: Even if a vehicle is eligible and you submit Form 8936 with the tax return to claim a clean vehicle credit, the return may reject for this form if the dealer has not submitted the vehicle and purchaser info to the IRS Energy Credits Online (ECO) website. The IRS relies on the dealer-supplied information on ECO. Without this information, the IRS can't link the vehicle purchased to the vehicle being claimed for a clean vehicle credit in the tax return.