California & U.S. Incentives

Businesses and tax-exempt organizations that buy a qualified commercial clean vehicle may qualify for a clean vehicle tax credit of up to $40,000 under Internal Revenue Code (IRC) 45W. The credit equals the lesser of:

• 15% of your basis in the vehicle (30% if the vehicle is not powered by gas or diesel)
• The incremental cost of the vehicle

Qualified vehicles with gross vehicle weight ratings (GVWRs) of under 14,000 pounds have a maximum credit of $7,500.

Plug-in electric vehicles must draw significant propulsion from an electric motor with a battery capacity of at least:

• 7 kilowatt hours if the gross vehicle weight rating (GVWR) is under 14,000 pounds
• 15 kilowatt hours if the GVWR is 14,000 pounds or more

A federal tax credit is available for new and used electric vehicles that meet requirements specified in Internal Revenue Code Section 30D.

New Vehicle Clean Credit up to $7,500.
You may qualify for a credit up to $7,500 if you buy a new, qualified plug-in EV. The Inflation Reduction Act of 2022 changed the rules for this credit for vehicles purchased from 2023 to 2032. Information about new vehicles purchased in 2022 and before or for vehicles purchased in 2023 and after.

Used Vehicle Clean Credit up to $4,000.
Beginning January 1, 2023, if you buy a qualified used electric vehicle (EV) from a licensed dealer for $25,000 or less, you may be eligible for a used clean vehicle tax credit. The credit equals 30% of the sale price up to a maximum credit of $4,000. Additional Details.

The credit is nonrefundable, so you can't get back more on the credit than you owe in taxes. You can't apply any excess credit to future tax years.

Starting in January 2024, an Inflation Reduction Act provision allows consumers to transfer the tax credit to car dealers, reducing the purchase price of eligible new and used vehicles at the time of sale.

The California Clean Fuel Reward has temporarily been reduced to $0, but is still providing EV information and resources to support their goal of reducing carbon emissions. Check the program website for more details.

The program will continue to be monitored and restored if/when conditions change.

Effective November 8, 2023, CVRP is closed to new applications. Applications received on or after September 6, 2023, will be placed on a standby list and are not guaranteed a rebate. Be sure to visit the program website for current information.

The Clean Vehicle Rebate Project (CVRP) promotes clean vehicle adoption in California by offering rebates from $1,000 to $7,500 for the purchase or lease of new, eligible zero-emission vehicles, including electric, plug-in hybrid electric and fuel cell vehicles.

The CVRP is administered throughout the state for the California Air Resources Board, part of the California Environmental Protection Agency.

Notice: Effective 10/5/2023 Driving Clean Assistance Program will no longer accept new applications.

Thank you for your interest in the driving clean assistance program (DCAP). At this time, all available grant funds have been exhausted and DCAP will not be accepting any new applications. Applications submitted before the effective date will be processed in the order received. However, there is no guarantee of grant funds. There is no timeline for more funding at this time.

The Bay Area Air Quality Management District is administering a Clean Cars for All program that provides grants for income-qualified Bay Area residents to retire their older car and replace it with a hybrid, plug-in hybrid, or battery electric vehicle, or to get a Clipper Card for public transit.

The program is supported by the California Climate Investments program, a statewide initiative that addresses climate change by reducing greenhouse gases and improving air quality.

Income-qualified customers may qualify for the following options offered through this statewide program aimed at making clean vehicles accessible and affordable:

A cash grant of $7,000 for a plug-in hybrid vehicle (PHEV) and $7,500 for a battery electric (BEV) or fuel-cell electric vehicle (FCEV).

A Level 2 charging station installed in your home by GRID Alternatives, up to $2,000 value.

A $1,000 prepaid charge credit valid at public EVGO charging stations plus a lower-speed portable charger.

Incentive amounts and availability are subject to change, be sure to visit the program website to make sure it is currently accepting applications.

The Consumer Assistance Program’s (CAP) vehicle retirement option offers eligible consumers an incentive to retire their operational vehicle. Consumers meeting the income eligibility requirement may receive $1,500 for each vehicle retired. All other vehicle owners may receive $1,000 to retire their vehicle at a BAR-contracted dismantler.

The Bay Area Air Quality Management District offers eligible applicants $1,000 to take their operating and registered vehicle off the road. Vehicle must be a 1996 or older model and must have passed its most recent smog check inspection.

Contact: Environmental Engineering Studies, Inc. at 1-855-343-7314

If you drive a vehicle that meets certain emissions standards and other criteria, you may be able to get Clean Air Vehicle (CAV) decals and a CAV decal identification (ID) card, which allow single occupancy use of High Occupancy Vehicle (HOV, or carpool) lanes.

The Clean Air Vehicle (CAV) Decal Program is administered by the Department of Motor Vehicles (DMV) in partnership with the California Air Resources Board (CARB).

The CAV Decal Program is subject to authorization by the Federal Highway Administration. If federal authorization is withdrawn, the program may end sooner than specified in state law.

Eligible clean air vehicles (CAVs) with valid clean air vehicle decals can travel toll free or at a discounted rate on Bay Area express lanes and state-owned bridges (not including the Golden Gate Bridge). In order to receive the correct discount, eligible clean air vehicles should use a FasTrak Flex or FasTrak CAV toll tag.

Consumers who purchase qualified residential charging equipment may receive a tax credit of 30% of the cost, up to $1,000.