Treasury Department Releases Notice of Proposed Rulemaking on New EV Tax Credit

by Paul Ciampoli
APPA News Director
April 3, 2023

The Treasury Department on March 31 announced a Notice of Proposed Rulemaking regarding vehicle eligibility under the new electric vehicle tax credits created by the Inflation Reduction Act.

The Notice of Proposed Rulemaking “provides clarity and certainty to manufacturers on the Inflation Reduction Act requirements that vehicles eligible for the clean vehicle credit undergo final assembly in North America and do not exceed a Manufacturers Suggested Retail Price of $80,000 for a van, pickup truck, or sport utility vehicle, or $55,000 for any other vehicle,” the Treasury Department said in a news release.

Building on the anticipated approach detailed in a white paper released in December, the Notice of Proposed Rulemaking also explains how manufacturers may satisfy the critical mineral and battery component requirements under the Inflation Reduction Act.

To be eligible for a $7,500 credit, clean vehicles must meet sourcing requirements for both the critical minerals and battery components contained in the vehicle. Vehicles that meet one of the two requirements are eligible for a $3,750 credit.

The Notice of Proposed Rulemaking is open for public comment and will be formally published on April 17, 2023, and vehicles placed in service on or after April 18, 2023, will be subject to the requirements of the rule, including the battery and critical mineral requirements.

At that time, FuelEconomy.gov will have a list of eligible vehicles that manufacturers have indicated to the IRS meet the new requirements to claim the tax credit.

Click here for additional details.