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Colorado Tax Credits

As a plug-in electric vehicle (PEV) purchaser, you are eligible for up to $7,500 in Federal and $6,000 in Colorado tax credits.  Colorado allows an income tax credit to taxpayers who have purchased an alternative fuel vehicle, converted a motor vehicle to use an alternative fuel, or have replaced a vehicle’s power source with an alternative fuel power source.

Here is a simple guide showing how to calculate your state tax credit and how to claim your federal.

STATE OF COLORADO

1. HB 13-1247 restructured the method for determining electric vehicle tax credits in Colorado, but it also extended these credits through the year 2021. The new formula is very simple for calculating the credit amount you would receive for your electric vehicle, and is as follows:

(Purchase price or sum of lease payments X battery capacity in kWh) ÷ 100  = State credit amount

Nissan Leaf Example:

($21,300 (base price of Leaf after $7,500 federal credit) X 24kWh) ÷ 100 = $5,112 Credit

Income 67 Colorado Innovative Motor Vehicle and Alternative Fuel Vehicle Tax Credit fact sheet.

FEDERAL

The auto dealer you purchase your vehicle from should take the $7,500 federal tax credit off the price you’re paying for the vehicle. In the case they do not, this is how you would claim your tax credit personally.

In order to receive your federal alternative vehicle tax credit, identify how much your vehicle qualifies for (Federal Tax Credit Values) and fill out the 8936 form for the IRS. Form 8936 Instructions