Is There a Tax Credit for Electric Bikes?
February 14, 2023
Are you considering buying a light electric bike but wondering if any tax credits are available to help offset the cost? You’re not alone–many people are interested in electric bikes as a more environmentally friendly and cost-effective transportation option, but the upfront cost can be a barrier. Luckily, a few tax credits are available to help make electric bikes more affordable. Many state ebike rebate bills are focused on cargo-class ebikes with even higher credit values.
Whether you’re a casual rider or an avid cyclist, understanding the tax credits available can help you make an informed decision when purchasing an electric bike.
What Tax Credits Are Available for My Purchase?
If you’re wondering if a tax credit is available for your e-bike purchase, there’s mixed news: the federal electric bike tax act for e-bike buyers in the United States is still a work in progress.
At this point, the credit would allow e-bike buyers to claim a 30% credit up to $1,500 on their federal tax return for purchasing a new electric bike. To qualify for this credit, the e-bike must be powered by an electric motor with a maximum power output of 750 watts and must be used primarily for personal transportation.
Other than that, some state governments offer additional credits for e-bike purchases. For example, qualifying applicants in California will get a voucher of up to $1,000 for a regular e-bike and up to $1,750 for a cargo or adaptive e-bike. Oregon offers $400 for general residents and $1,200 for people whose income falls within 80% of the area’s median.
Even if you don’t see your state in the list below, do some quick research! Many states are in the process of passing bills to make purchasing an ebike less burdensome financially and more accessible to us all. It’s important to check with your state’s tax laws to see if additional credits are available for your e-bike purchase.
A list of states that are in process or provide e-bike tax credits are:
When Can You Claim the Tax Credit?
The timing for claiming a tax credit for your electric bike purchase will depend on the type of credit you’re eligible for. For the federal electric bike tax credit, you can claim the credit on your tax return for the year you purchased the e-bike. If you bought your e-bike in 2021, you could claim the credit when you file your 2021 federal tax return.
The timing for other credits may vary depending on the state. For example, some states allow you to claim the credit on your current tax return, while others may require you to claim the credit in the following tax year.
It’s important to check with your state’s tax laws to determine when you can claim the credit for your e-bike purchase.
Remember that the electric bike tax credit is generally only available for new e-bike purchases–used e-bikes do not qualify for credit. The credit is also only available for the year the e-bike was purchased, so it’s important to claim it as soon as possible.
While there may not be a blanket tax credit for electric bikes, there are still ways to save money when purchasing one. Ride1Up strives to provide affordable e-bike options nationwide, regardless of tax incentives. However, it’s worth researching and speaking with a tax professional to see what options are available to you.
Wondering if electric bikes are safe for seniors or if electric bikes are easy to ride? We’ve got you covered–check out our latest posts.