The Inflation Reduction Act has officially extended the Alternative Fuels Refueling Property Tax Credit, which originally expired in 2021. Businesses can again receive $30,000 for installing electric vehicle charging stations in 2022. However, beginning in 2023, new changes to the tax credit will dramatically reduce the number of businesses that can qualify. Here’s what you need to know. Timeline showing the EV Charging Tax Credit. Before 2022, businesses can get 30% up to $30,000. In 2022, the tax credit is retroactively extended to include 2022. In 2023, businesses can receive 6-30% per station if they meet census tract requirements.

Installations Before December 31, 2022

Under the current version of the electric vehicle charging incentive, businesses can receive federal tax credit for 30% of total project fees, up to $30,000 and excluding permitting and inspection fees. This credit is available per site, which means that multi-site businesses can receive $30,000 for each site that installs charging stations. This version of the credit only applies to stations installed by December 31, 2022.

With EV charging stations in stock and ready to ship within approximately three weeks , SemaConnect can help you take advantage of these major savings before time runs out. If you have already received your SemaConnect stations but have not scheduled your electrical work with your contractor, you must make sure your stations are installed before year-end. On your 2022 taxes next year, you can use Form 8911 to claim credit.

Installations On/After January 1, 2023

Under the new version of the federal EV charging tax credit, starting January 1, 2023, most businesses may lose eligibility for future projects, as qualifying projects must be within a designated census tract. In addition, some aspects of the tax credit are subject to more stringent labor clauses. For those projects that qualify, the new credit is applicable at a per-station versus the current per-site level schema.

Qualifying businesses can receive 6% of project costs, up to $100,000 per station. However, stations must be installed in census tracts meeting the following criteria:

  • 20% or higher poverty rate
  • Non-Metropolitan Areas: Median family income is less than or equal to 80% of the statewide median
  • Metro Areas: Median family income is less than or equal to 80% of the metro-area median

To see if your planned installation is located in a designated census tract, you can search your address in the US Treasury’s Community Development Financial Institutions Fund map using the NMTC layers.

There is also a bonus tax credit, which multiplies the 6% base credit by five, so businesses can receive the full 30% credit. This bonus credit is restricted to businesses that meet wage and apprenticeship requirements:

  1. Wage Requirements: Laborers and mechanics are paid prevailing wages during installation
  2. Apprenticeship Requirements: Qualified apprentices perform no less than:
    • 10% of total labor hours for projects beginning in 2022
    • 12.5% of total labor hours for projects beginning in 2023
    • 15% of total labor hours for projects beginning after 2023

The Federal Tax Credit and Your Business

While the passage of the Inflation Reduction Act is great news, businesses currently planning or considering EV charging stations must be mindful of the December 31 cutoff. In 2022, virtually any business/tax paying entity can claim the federal tax credit. Beginning on January 1, 2023, only businesses located in designated census tracts will qualify. That means that if you are currently planning EV charging stations at your business, you must complete installation by December 31, 2022 to receive the $30,000 tax credit.

SemaConnect is your partner for premium, easy-to-use EV charging stations for your business or fleet. With stations in stock, we can help you plan, install, and manage your charging stations while taking advantage of these major savings before time runs out. Get started with a quote today!

Picture of a woman plugging an EV into a SemaConnect Series 7 charging station

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