There's an indisputable perk to buying an electric car — here's how it really works (TSLA)

pulse

June 13, 2017 8:51 PM

Credits vary depending on the manufacturer and other factors.

A Tesla vehicle being recharged.

One of the factors that gets consumers off the fence about electric-car ownership is the tax break, both federal and in some states.

But the credits vary, depending on manufacturer — and the issue is more prominent for some carmakers, especially Tesla, which was recently clonked at gonzo finance blog Zero Hedge for seeing a big quarterly sales drop when tax incentives in Denmark were phased out.

The Department of Energy and the IRS break down the rules in the US, but here's a basic rundown (and remember, at the federal level we're dealing with a tax credit here, so you only get to use it if you if you owe taxes, and you can only reduce your tax liability to zero, no lower, so there's no carryover).

For Tesla, the federal credit for all three of its eligible vehicles, including the discontinued Roadster, is $7,500. That's the maximum the IRS allows, and the Tesla credit is at that level because its vehicles have such large batteries.

The minimum federal credit is $2,500. Importantly, you can individually claim the credit as a vehicle owner, but not as a leaser. At the low-end of vehicles that qualify, you'll find the gas-electric plug-in hybrid BMW i8, at

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