Federal tax credits for Kia electric and plug-in-hybrid vehicles

Receive a Federal Tax Credit Up To $7,500!

All-electric and plug-in hybrid Kia's purchased may be eligible for a federal income tax credit of up to $7,500. The credit amount will vary based on the capacity of the battery used to power the vehicle. State and/or local incentives may also apply.

  Kia Niro Plug-in Hybrid PHEV   $4,543
   Kia Optima Plug-in Hybrid PHEV  $4,919
   Kia Soul EV EV  $7,500
*Qualified Plug-in Electric Drive Motor Vehicles (IRC 30D) 
REQUIREMENTS

To be certified for the credit by the manufacturer, the vehicle must meet the following requirements:

  • The vehicle must be made by a manufacturer (i.e., it doesn't include conventional vehicles converted to electric drive).
  • It must be treated as a motor vehicle for purposes of title II of the Clean Air Act.
  • It must have a gross vehicle weight rating (GVWR) of not more than 14,000 lbs.
  • It must be propelled to a significant extent by an electric motor which draws electricity from a battery which
  • has a capacity of not less than 4 kilowatt hours and
  • is capable of being recharged from an external source of electricity.

The following requirements must also be met for a certified vehicle to qualify:

  • The original use of the vehicle commences with the taxpayer-it must be a new vehicle.
  • The vehicle is acquired for use or lease by the taxpayer, and not for resale. (The credit is only available to the original purchaser of a new, qualifying vehicle. If a qualifying vehicle is leased to a consumer, the leasing company may claim the credit.)
  • The vehicle is used mostly in the United States.
  • The vehicle must be placed in service by the taxpayer during or after the 2010 calendar year.


HOW TO CLAIM THE CREDIT

Fill out Form 8936, Qualified Plug-in Electric Drive Motor Vehicle Credit.

For vehicles acquired for personal use, report the credit from Form 8936 on the appropriate line of your Form 1040, U.S. Individual Income Tax Return.

For vehicles purchased in 2010 or later, this credit can be used toward the alternative minimum tax (AMT).

If the qualifying vehicle is purchased for business use, the credit for the business use of an electric vehicle is reported on Form 3800, General Business Credit.


Frequently Asked Questions about Vehicle Tax Incentives

Q: What's the difference between a deduction and a credit?

A: A tax deduction reduces the amount of income for which you are taxed. For example, if your taxable income were $50,000, a $2,000 deduction would reduce it to $48,000. So, you would pay taxes on an income of $48,000 instead of $50,000. This means your actual savings would be a fraction of the $2,000 deduction.

A tax credit reduces the total amount of income tax you owe. So, if you owed $10,000 in federal income tax, a $2,000 credit would reduce the amount you owed to $8,000. With a credit, your actual savings would be $2,000.

Q: Where can I find information on State incentives?

A: The U.S. Department of Energy's (DOE's) Alternative Fuels Data Center (AFDC) maintains a list of State & Federal Incentives.

Q: Can I claim the credit for a used vehicle?

A: No. The credit applies to new vehicles only.

Q: Can I claim the credit for a leased vehicle?

A:If a qualifying vehicle is leased to a consumer, the leasing company may claim the credit.


**This information comes from the Internal Revenue Service (IRS) and is not from Orlando Kia West. Information is subject to change. please visit IRS.gov for more information

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