Thinking of buying an electric car in Delaware? How to save money with rebates, credits
As Delaware gears up for more electric and hybrid vehicles to hit the road in the coming years, the state environmental department has extended its Electric Vehicle Rebate Program until April 30, 2024.
And, federal tax credits are also still in place for the purchase of new electric or hybrid vehicles.
Delaware's Climate Action Plan aims to cut greenhouse gas emissions to a quarter of 2005 levels by 2025. The push for electric vehicles is a major part of reducing emissions in the transportation sector, which accounts for 30% of the state's total greenhouse gas emissions.
These credits and rebates apply to select vehicle models only and have several other requirements.
We compiled all of the rules and regulations to follow in Delaware to take advantage of the savings.
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What is the rebate?
The state's cash rebate program offers $2,500 for battery electric vehicles worth $50,000 or less and up to $1,000 for plug-in electric hybrid vehicles. There are also additional rebates available for propane, natural gas and bi-fuel vehicles.
New electric vehicles have a battery that is charged with special equipment and operate in all-electric mode. They can drive anywhere from 150-400 miles.
A plug-in hybrid vehicle can operate in all-electric mode for around 20-40 miles and then operate on gasoline until it is recharged.
Dedicated propane vehicles run on propane only and are mostly used with heavier-duty vehicles like trucks or buses.
Dedicated natural gas vehicles run only on, you guessed it, natural gas and are typically best suited for high mileage.
And bi-fuel vehicles use either gasoline or an alternative fuel (in this case either propane or natural gas), with separate fuel tanks and lines that can be switched by the driver.
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The state environmental website has a list of over three dozen vehicle makes and models that the rebate can be used on, including Tesla, Audi, Ford, Hyundai and Kia.
The Biden administration is continuing to offer a federal tax credit (not a cash rebate), of up to $7,500 for all electric, plug-in hybrid and fuel cell electric vehicles purchased new this year. The vehicle will need to meet mineral and battery component requirements to claim the maximum amount.
Used electric vehicles are also eligible for a credit of up to $4,000, or 30% of the purchase price, provided that the car is less than $25,000, more than 2 years old and is being sold by its original owner.
What are the criteria?
The requirements for both the state rebate and the federal tax credit are slightly different.
Delaware's Electric Vehicle Rebate Program:
The total vehicle price, including any fees, cannot exceed $50,000.
Applications must be submitted within 90 days of the vehicle's purchase date.
The vehicle must be new and purchased / leased in Delaware before April 30, 2024.
Any lease must be for at least three years.
You are eligible for only two rebates during the lifetime of the program. Businesses, nonprofit organizations, governments, educational institutions and other eligible entities may not receive more than six rebates.
Proof of purchase and proof of Delaware residency must be included in the application.
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Federal tax credit:
Adjusted gross income must not exceed $300,000 for married couples, $225,000 for heads of households and $150,000 for all other filers.
Qualified vehicles must have a battery capacity of at least 7 kilowatt hours and must weigh less than 14,000 pounds.
The vehicle must undergo final assembly in North America. You can enter a vehicle identification number to check.
Sale price cannot exceed $80,000 for vans, sport utility vehicles and pickup trucks and $55,000 for other vehicles.
How do I submit an application?
Steps to apply for a cash rebate with the state:
Register as a "supplier" with the state of Delaware using the appropriate portal; you will need to keep the supplier ID number provided after this process. There are instructions available for this process.
Put together your application package as one PDF file.
Send the application package in one PDF file to DNREC.Transportation@delaware.gov.
Wait 8-10 weeks to receive your rebate.
The rebate may be considered taxable income by the U.S. Internal Revenue Service and the Delaware Department of Revenue, so try and speak with a tax professional to determine what that means for you.
To claim the federal tax credit, file Form 8936 with your tax return. You'll need your vehicle identification number when filing.
Some car dealerships in the state will be participating in the rebate program and can handle the paperwork for you. This will result in $1,000-$2,500 off your purchase of an electric or hybrid vehicle.
State environment officials say it's possible the rebate program may be extended past April 2024.
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Contact Molly McVety at mmcvety@delawareonline.com. Follow her on Twitter @mollymcvety.
This article originally appeared on Delaware News Journal: Buying an electric car in Delaware? How to get a rebate, tax credit
