FAQs:

Clean Car and Charging Units Tax Credit

 

1. What is the Clean Car Tax Credit?

This tax credit is a personal and business income tax credit for electric vehicles, plug-in hybrid electric vehicles and other zero-emission vehicles, as well as for home and commercial electric vehicle chargers.

  

2. What vehicles are eligible?

New or used electric, plug-in electric hybrid, and fuel cell motor vehicles are eligible. To be eligible for the tax credit, previously owned vehicles must have a model year that is at least two years prior to the calendar year in which the taxpayer purchased or leased the vehicle. Leased vehicles are also eligible provided the lease is for a term of at least three years.

A new vehicle must have a base manufacturer suggested retail price, before options and destination charges and before any taxes are imposed, of fifty-five thousand dollars ($55,000) or less.

A previously owned vehicle must have a market value of twenty-five thousand dollars ($25,000) or less, be certified by the certified by the dealer selling the motor vehicle and have a dealer-provided warranty of at least a one-year against defects and repairs.

A car is eligible only twice in its lifetime – once when it is sold new, and the second time when it is sold used. Any third or subsequent sales are not eligible for the tax credit.

 

3. What chargers are eligible? 

Each level of charging offers different charging speeds and convenience, catering to various use cases and requirements of EV owners. When considering an EV charger for home or business use, it’s essential to assess your charging needs, available electrical infrastructure, and budget to choose the most suitable option. Here is an overview of the different levels of EV chargers: 

Level 1: Chargers are eligible for the Clean Car Charging Unit Tax Credit:

Level 1 chargers use a standard 120-volt AC outlet, typically found in residential settings. These chargers are slow, inexpensive or free to install and can be convenient for overnight charging or in situations where faster charging isn’t necessary. Level 1 chargers typically deliver around 2 to 5 miles of range per hour of charging, depending on the vehicle’s battery capacity. 

Level 2: Chargers are eligible for the Clean Car Charging Unit Tax Credit:

Level 2 chargers use a 240-volt AC outlet and are faster than Level 1, making them suitable for home charging and some public charging stations. Level 2 chargers typically deliver around 10 to 60 miles of range per hour of charging, depending on the charger’s power output and the vehicle’s capabilities. They are commonly found in residential garages, workplaces, and public charging stations.

Level 3: Charging (DC Fast Charging or DC Quick Charging) are eligible for the Clean Car Charging Unit Tax Credit:

Level 3 chargers use direct current (DC) and are significantly faster than Level 1 and Level 2 chargers. They are primarily installed in public charging stations along highways, at rest stops, or in commercial areas. Level 3 chargers can deliver high power and charge EV batteries to 80% or more in under an hour, making them suitable for long-distance travel. However, Level 3 chargers require special equipment, a special connection to the electrical grid, and are more expensive to install than Level 1 and Level 2 chargers. 

  

4. How much are the tax credits?  

The tax credits vary depending on the type of vehicle and the taxable year in which the vehicle was purchased. See tables below for details on rebate amount for vehicles and chargers.

 

Vehicles: 

	Tax year of vehicle purchase	2024 – 2026	2027	2028	2029
New	EV	$3,000	$2,200	$1,470	$960
	Plug-in hybrid/Fuel Cell	$2,500	$1,850	$1,225	$800
Used	EV	$2,500	$1,850	$1,225	$800
	Plug-in hybrid/Fuel Cell	$2,000	$1,480	$980	$640

 

 

Charging Unit:

Charging unit type	Amount
Direct current fast charger	$    25,000.00
Fuel cell charging unit	$    25,000.00
Other electric vehicle charging units (e.g. Level 2)	$        400.00

 

5. Who is eligible to receive the EV tax credit?   

Vehicles:

Taxpayers who are not dependents of another individual and who purchase or lease (for at least three years) an electric, plug-in hybrid electric, or fuel cell motor vehicle are eligible.

Please note: to qualify for the tax credit, a person must have purchased the EV (new or used) through a dealer licensed by the New Mexico Motor Vehicle Division, or a dealer located on tribal land within New Mexico. You cannot get the credit if you purchase the car from another individual.

Chargers:

The program offers a tax credit toward the purchase and installation of qualifying electric vehicle charging equipment, and for the installation of charging units connected to electric facilities needed to serve their electric vehicle charging equipment. (Note: Level 3 charging units must be installed by a licensed electrician and connected to a utility network).

  

6. If I sell my used EV, do I get the tax credit?  

If you sell your used electric, plug-in hybrid or fuel cell vehicle, you, as the seller, would not be eligible to claim the clean car income tax credit for that transaction. The tax credit is available to taxpayers who purchase or lease qualifying vehicles. Same with chargers. Sellers are not the recipients of Clean Car Tax Credit.

 

7. When are the tax credits available?   

Vehicles and chargers purchased on or between May 15, 2024 through December 31, 2029, are eligible.

 

8. How do I get the tax credit?

1. Purchase or Lease a Qualifying Vehicle or purchase and install a charging unit: Buy or lease an eligible vehicle, or buy an eligible charger, between May 15, 2024 and December 31, 2029.

2. Apply for Certificate of Eligibility: Submit an electronic application for certificate of eligibility to the Energy, Minerals, and Natural Resources Department. However, we are still finalizing the rules and other details, so you cannot apply for the tax credit quite yet. We anticipate opening the online portal, where you will apply, at CleanEnergy.nm.gov. You must apply no later than one year from the date on which the vehicle is purchased or the lease is entered into.

3. Receive Certificate of Eligibility: If the Energy, Minerals and Natural Resources Department determines that you meet the requirements, we will issue a certificate of eligibility stating the amount of tax credit you are eligible for and the taxable years in which the credit may be claimed.

4. Claim the Tax Credit: When you file your taxes with the state of New Mexico, claim the tax credit in accordance with the instructions provided by the Taxation and Revenue Department. The credit must be claimed within three taxable years of the end of the year in which the department certifies the credit.

 

9. Is this a point-of-sale rebate?  

No. This is not an instant rebate, rather a tax credit incentive.

   

10. What if the credit is higher than the amount of tax I owe? Are the credits available in cash, or transferable?    

Excess tax credits can be refunded to the taxpayer if they exceed their income tax liability. Additionally, Clean Car Tax Credit certificates of eligibility can be sold, exchanged, or transferred to others, with notification required to the Taxation and Revenue Department within ten days of the transaction. 

 

11. I purchased a used vehicle from a private seller; does my purchase qualify for tax credit?

To qualify for the tax credit, a person must have purchased the EV (new or used) from a qualified dealer in New Mexico or a registered dealer on tribal lands. For example, you cannot get the tax credit if you purchase the car from an individual.

12. For used EV purchases, does a car dealer need to provide at least a one-year extended manufacturer’s warranty against defects and repairs?

A previously owned vehicle must have a market value of twenty-five thousand dollars ($25,000) or less, be certified by the certified dealer selling the motor vehicle and have a dealer-provided warranty of at least a one-year against defects and repairs.

13. Is Carmax a licensed dealers of clean car sales/leases?

Yes. Carmax has a brick-and-mortar location where customers can go in test drive and purchase. Carmax’s New Mexico license is set to expire 04/30/2026. ECAM cannot state if Carmax’s license will be renewed once it expires.

 

14. Is Carvana a licensed dealers of clean car sales/leases?

Yes.

 

15. How do I apply?

To get started, visit: CleanEnergy.nm.gov

For further questions please email our main office email: emnrd.ecmd@emnrd.nm.gov

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Clean Vehicle Tax Credit – Out-of-State Pickup FAQ

 

16. If I purchase a clean vehicle and the sales contract identifies the seller as a New Mexico dealer or a dealer located on tribal land, am I still eligible for the state tax credit if the vehicle is delivered to or picked up in another state?

A: Yes, if the sales contract or purchase agreement identifies the seller as a New Mexico dealer or a dealer located on tribal land, and the transaction is finalized within New Mexico. The key factor is where the sale is legally completed, not where the vehicle ends up. So if you’re buying from a qualifying dealer and the paperwork is done in New Mexico, you’re eligible to apply for the tax credit incentive.

 

17. I am purchasing a clean vehicle from a New Mexico dealer, but I plan to pick it up in another state. Am I still eligible for the New Mexico Clean Vehicle Tax Credit?

A: Yes. You may qualify for the state tax credit as long as the sales transaction is finalized in New Mexico and the seller is a licensed New Mexico dealer or a dealer located on tribal land within the state. The location of vehicle pickup or delivery does not affect eligibility.

 

18. What does it mean for the sale transaction to be finalized in New Mexico?

A: The purchase agreement must be executed in New Mexico, and the seller must be licensed by the New Mexico Motor Vehicle Division (MVD) to sell vehicles in the state.

 

19. Does it matter which state I pick up the vehicle from?

A: No. You may take delivery of the vehicle in any state, such as Colorado, Arizona, Texas, or others. As long as the sales transaction is completed in New Mexico through a qualifying dealer, you remain eligible.

 

20. What if the vehicle is shipped to me outside of New Mexico?

A: You are still eligible for the credit if the sale transaction is conducted through a qualifying New Mexico dealer and the transaction is finalized within the state.

 

21. How can I confirm if the dealer qualifies?

A: Review your purchase agreement to ensure the seller is listed as a licensed New Mexico dealer or a dealer located on tribal land operating within New Mexico. If you are unsure, contact the dealer directly or consult the New Mexico Motor Vehicle Division. https://eservices.mvd.newmexico.gov/partner/_/

 

22. Do I need to register the vehicle in New Mexico to qualify for the tax credit?

A: Yes. The vehicle must be registered in New Mexico and applicable taxes must be paid to the state.

 

23. If I purchase a vehicle online, will I qualify for a tax credit?

A: Probably. To qualify for a tax credit via an online vehicle purchase in New Mexico:

• The dealership must be licensed in New Mexico, or be a dealer located on tribal land, operating within the jurisdiction of the New Mexico Motor Vehicle Division.
• The dealer’s New Mexico license number must be clearly indicated on the purchase agreement, affirming that the transaction was conducted in accordance with state regulations.

 

If you’re unsure whether your purchase will qualify, it’s best to contact the dealer directly or consult the New Mexico Motor Vehicle Division for guidance. https://eservices.mvd.newmexico.gov/partner/_/

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