The IRS Form 8936 is used to claim an EV tax credit for a qualified plug-in electric vehicle. Under circumstances where a vehicle is used for both business & personal use, the taxpayer must report separate amounts on IRS Form 8936.
The business use portion of the tax credit is treated as a general business credit and reported on Form 3800, while the personal portion of the tax credit is reported on Form 8936 and Schedule 3 as a qualified plug-in motor vehicle credit.
In this tutorial, we cover how to report the separate amounts for a business owner who purchased a qualified 2022 Ford F-150 Lighting EV model truck. The truck was purchased for cash through his business LLC.
For other videos on Form 8936, see the below:
Form 8936 for 2023: • IRS Form 8936 for Clea...
Form 8936 for 2022: • How to Fill Out Form 8...
Form 8936 for 2021: • Electric Vehicle Tax C...
Bonus Depreciation for Vehicles: • 100% Bonus Depreciatio...
Bonus Depreciation Recapture: • Bonus Depreciation Rec...
In order to claim the credit, the vehicle must generally meet the following requirements for 2022:
1. Vehicle must be new
2. Vehicle must be propelled by an electric motor that draws electricity from a battery, and the battery is recharged by an external power source; and
3. The gross vehicle weight must be less than 14,000 pounds.
If you have doubts about whether the vehicle qualifies, you can check the following websites to look up the year, make & model.
FuelEconomy: www.fueleconomy.gov/feg/tax20...
IRS Website: www.irs.gov/credits-deduction...
Alternative Fuels Data Center: afdc.energy.gov/laws/electric...
Under the Inflation Reduction Act (IRA), substantial changes were made to the types of vehicles eligible for the tax credits. Beginning in 2023, there are options for both new and used vehicles. In addition, the vehicle's final assembly must now occur within North America to be eligible for the tax credit.
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