Which EVs will be eligible for instant tax rebates in 2024?

The rules surrounding EV tax credit eligibility will change in the US in 2024. There are still many unanswered questions about which cars will be eligible for the full $7,500 federal incentive. Unlike the current system, which requires you to take the discount from the purchase of the car as a reduction in your tax bill when you file your taxes, the new system will allow dealers to take the full amount as an immediate discount from your purchase price to take, and it will be applied to your taxes afterwards. The new system is a bit stricter, but requires a lower MSRP cap and a US-built battery to be eligible. So which cars fit the bill?

The point of this change is to provide incentives for automakers to build their batteries and source their materials in the US in an effort to support American industry against China’s dominance. China currently produces about 70% of all electric vehicle batteries, and this federal program aims to level the playing field a bit. EVs with battery materials sourced from “foreign entities of concern” (namely China, North Korea, and Russia) will receive no federal incentive whatsoever. Cars with at least 50% of materials sourced in North America, or one of the 20 countries with which the US has a free trade agreementwill be eligible for $3,750 of the rebate.

To get the full rebate amount, at least half of their battery components would have to be specifically sourced and assembled in the US, Canada or Mexico, plus the critical minerals – lithium, nickel, cobalt, manganese and graphite – needed to be sourced from a country with which the US has a free trade agreement. Even if your EV meets all of these criteria, it may not get federal support if you make too much money (over $150,000 for individuals), or it costs too much. Sedans have a price cap of $55,000, while SUVs have a price cap of $80,000.

These new rules pushed some cars off the rebate list entirely, and others’ status was reduced from the full rebate to just half. For example, Ford says the Mustang Mach-E will likely no longer be eligible for any rebates starting Jan. 1. Tesla, meanwhile, says the Model 3 RWD and Long Range’s incentives will be reduced to $3,750. The Volkswagen ID.4 and Nissan Leaf also appear to be off the list.

So which cars are still eligible for the full boat? Let’s find out.