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Chevy Volt Federal Tax Credit – Form 8936 (2013 Update)

I’ve seen several new questions pop up about claiming the tax credit for any Volt purchased in 2012, So here’s my newest attempt to address the more current questions that we see popping up in the forums.  Not all are fully answered yet, but I’ll see if I can find more.

update 2/10/2013

More IRS Tax form 8936 FAQ’s – Updated with some more FAQ’s from this year that I’ve seen floating around…

Q1:  What is this manufacturer’s certification that I need to turn in?

A1:  General Motors / Chevrolet has already provided the manufacturer’s certification to the IRS, so if you input the VIN number as needed for the form, you should be fine.  This is mostly needed for small EV manufacturers.  You don’t need to do anything for this.  (I know this confuses a lot of people).

Q2:  the 2012 Form 8936 says only $2,500 rebate… huh??  I was promised $7500!

A2:  Yes, the form 8936 is very confusing.  The $2,500 rebate refers to 2 and 3 wheeled vehicles.  If you follow the instructions exactly or otherwise use tax software that supports this form you will indeed get the $7,500 tax credit, assuming that you have enough taxable income to deduct.  The Chevy Volt still qualifies for the full $7,500 tax credit and is not yet close to “phasing out”

More info on the EV tax credit here:  It’s still alive and kicking.

Example from Turbotax, though I made up the VIN.

form8936-2012-1

update 5/5/2012:

IRS Tax Form 8936 FAQ’s

Many of you have common questions about IRS form 8936, the $7500 EV Tax credit which applies for the Chevrolet Volt and other production EV’s.  While you can read the details of the questions in the post below, I tried to compile them into one section so that its easier to reference.  Keep in mind that I’m not a Professional Tax Adviser, so if there is an error let me know, but I provide this information to the best of my knowledge.  Always check with your tax adviser first if in doubt about your specific circumstance.

Q1:  Is there still money in the program?  Can I still get a $7500 tax credit if I buy a Volt today? 

A1:  Yes the Federal Tax Credit for the Chevrolet Volt is still alive and kicking!  The program starts to phase out after 200,000 Eligible vehicles per manufacturer have been claimed.  However, you need not worry if you bought Volt number 200,001 because the phase out happens starting 1 calendar quarter after the 200,000 vehicle is sold.  There’s a nice infographic on the IRS site that I’ve shown below.

Form 8936 Phase out Schedule

Check this link to the IRS Plug In Hybrids page to see when the phase outs happen.  (They aren’t close yet)

http://www.fueleconomy.gov/feg/taxphevb.shtml

 

 

Q2:  If I buy a Volt today (5/4/2012), when do I get the credit back?

A2:  You claim the tax credit on your 2012 Federal Taxes.  So you won’t see the money until you get your refund in 2013 after you’ve filed your taxes.

 

Q3:  I make $x dollars per year, have y kids, and $z mortgage, can I claim the full credit?

A3:  This is one that you really need to calculate out.  Be very careful with this as you may not get the full $7500 depending on your circumstance.  The tax credit is non-refundable and does not carry over.  Meaning you must claim it in one tax year, and you can’t carry over any benefit into future years.  IN General – if you have $7500 in tax liabilities after all your deductions, you can claim the full credit.  Someone making about $56,000 a year with only a standard deduction (no kids, mortgage etc) will generally be able to claim the full credit.  However, if you have significant deductions from kids / house, etc – you might run into trouble.  On way of doing a quick check is to see how much you owed the IRS in taxes last year (assuming this year your tax circumstances didn’t change materially).  This is not the amount you paid or got refunded, but the total tax owed.   (This is on Line 44 last year of your 1040)

If you hit AMT, sorry I can’t help you.  I don’t know nearly enough about that.  I’ll let you know when I hit AMT ;)

Q4:  What happens to the tax credit if you sell the car?

A4:  You keep it.  The first individual or company to “own and register the car” claims and keeps the credit.  The credit is only available once per vehicle to the first owner.  So if you buy a used Volt, you don’t get to claim the credit.

 

Q5:  Can I claim the tax credit on a leased Volt / EV?

A5:  No the leasing company “owns” the Volt.  They basically claim the credit and factor that into the lease payments.  You benefit from the tax credit through lower lease payments.

 

Original Post 2/26/2011:

Did you recently buy a Chevrolet Volt?  Do you pay taxes in the United States?  (Haha I know – who doesn’t?) – well if you answered yes to the previous two questions you are entitled to get $7500 back from Uncle Sam on your next tax return!  It was actually very easy to do and is supported by most common tax software.

There are a couple things that might be helpful for you to know in filling out your worksheet though and they are listed here-

  1. The model year of the Volt (2011 for right now)
  2. Gross Vehicle Weight (3800 lbs)
  3. Battery Capacity (16 Kw-H)

That’s it!  As long as you owe more than $7500 in federal taxes you’ll get that back in the form of a tax credit!  Check out the forms below for an example if you do it by hand or have any questions.  Obviously I took our my social security number from the forms – but you get the picture.

Additionally if you purchased an EV Charging Station in Calendar Year 2010, you are entitled to a 50% credit on that installation!  (Turbotax doesn’t have that readily available though, so you’ll need to manually file if you want to take that credit unfortunately.  Sorry the credit for EV charging station installation has expired as of the end of 2011 (5/5/2012 update).   

 

111 Responses to “Chevy Volt Federal Tax Credit – Form 8936 (2013 Update)”

  1. Fred says:

    Thanks for the details Patrick. How about the credit for the charger purchase/installation?

  2. Fred says:

    Minor editorial note: the title of the post contains 8963, should be 8936.

  3. PatrickZWang says:

    Thanks Fred – fixed now. The Charger Purchase Credit is on a form 8911. Unfortunately the IRS site’s link to that form is not working right now. You might try to download it through your tax software.

    • Rob says:

      Q; I have encountered a 2011 Volt being sold at a dealership used. The $7500 rebate is not being offered as the dealership already purchased the Volt and claimed the rebate. Is this legal? The Volt was only used as a dealership demo.

      • John says:

        The issue here is whether the vehicle has been registered (titled). The dealership might have titled it in order to get the rebate, then used it as a demo car. Usually, dealers do not title their vehicles, but getting $7500 tax rebate is certainly a nice incentive for them to title Volts.

  4. cederic says:

    What happens to the tax credit if you decide to sell the car?

    • PatrickZWang says:

      You get to keep it. No restrictions on how long you’ve owned the car for. Obviously the person that buys it from you doesn’t get it though.

      Patrick

  5. Glen says:

    What happens if your calculated tax before the credit is less than $7,500? Will you get a refund or loose the credit?

    • PatrickZWang says:

      The credit is non-refundable, meaning that if you owe less than $7500 in taxes, you don’t get the full benefit. Most people earning more than $55,000 a year will be able to take the full benefit though given current federal tax rates.

      Patrick