For anyone who’s planning on buying an electric vehicle in the near future, we’ve got some good news and some bad news to share.
Let’s start with the bad news: the federal EV tax credit — which offered $7,500 to those who purchased a new EV and $4,000 to those who purchased a used model — expired on September 30, 2025. These tax credits were originally set to expire by the end of 2032, but President Trump’s One Big Beautiful Bill dramatically shortened that timeline [1].
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This subsequently led to a surge in sales, with new EV sales up 17.7% in August compared to the same time last year, according to data from Cox Automotive. This surge lifted the EV market share to an all-time high of 9.9%. Used EV sales were also up by a whopping 59% year-over-year [2].
Some automakers posted their best EV sales of the year in August, with Tesla, Chevrolet, Ford, Hyundai and Honda leading the market. However, Tesla’s overall market share dropped by four points while Honda’s market share surged 47.9% month-over-month.
But the good news is that even if you’ve missed the deadline, there are other ways you can save on the purchase of an EV.
How the EV tax credit worked
If you entered into a purchase agreement for an EV and made a payment before the September 30 deadline, you may still be eligible for the tax credit. Once a buyer takes possession of the vehicle (even if it’s after the deadline), they can then claim the credit.
However, eligibility for this tax credit was quite specific. To be eligible, an electric vehicle must have been manufactured in North America with a portion of the vehicle’s battery components produced in the U.S., or any country that has a free-trade agreement with the U.S. Even the critical minerals in the battery — and where those minerals were sourced — were a factor [3].
The credit applied only to vehicles with a manufacturer’s suggested retail price below $80,000 (for SUVs, vans and pickup trucks) or $55,000 (for all other vehicles). It also only applied to households under a certain annual gross income — $300,000 for married couples filing jointly, $225,000 for heads of households and $150,000 for all other filers.
Read more: How much cash do you plan to keep on hand after you retire? Here are 3 of the biggest reasons you’ll need a substantial stash of savings in retirement
How you can still save on an EV purchase
If you missed the September 30 deadline, that doesn’t mean you’re completely out of luck.
“Automakers and the government alike have been offering plenty of sales incentives on EVs, with the typical incentive package reaching a record 17.5% of average transaction price in July before dropping to 16% in August,” according to Cox Automotive [4].
Furthermore, most states and some municipalities offer rebates, credits and other incentives on EV purchases [5]. The Department of Energy offers an interactive map of state laws and incentives related to alternative fuels, and Kelley Blue Book also offers a list of EV incentives available in each state, which are continually evolving [6].
Some automakers offer incentives such as free home charging stations and/or installation or credits for public charging. Certain Ford EV models, for example, come with a complimentary charger and standard installation [7].
Buyers can also save money by opting for an EV with less range, which may be an option for people who don’t drive much and use their vehicle for running errands around town.
It’s also worth noting that once you own an EV, you can save money on fuel, repairs and maintenance. EVs saved $943 in fuel costs for the average U.S. driver in 2024, according to analysis from Coltura [8].
In most cases, EVs deliver savings over the lifetime of a vehicle — ranging from more than $2,000 for a compact vehicle to more than $8,000 for a mid-size SUV, according to Atlas Public Policy [9].
So, if you missed the federal EV tax credit deadline, don’t despair. With a bit of research, you can still find ways to save money on the purchase of an electric or hybrid vehicle.
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Article sources
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[1]. Consumer Reports. “Electric Cars and Plug-In Hybrids That Qualify for Federal Tax Credits (For Now)”
[2]. Cox Automotive. “EV Market Monitor – August 2025”
[3]. Edmunds. “Electric Vehicle Tax Credits Set to End in 2025: What You Need to Know”
[4]. Cox Automotive. “After the Credits: How EV Adoption Advances When Incentives Fade”
[5]. Cars.com. “How Can You Save on Your EV Purchase?”
[6]. Kelley Blue Book. “Electric Car Rebates and Incentives: What to Know by State”
[7]. Ford. “The Ford Power Promise”
[8]. Coltura. “NEW ANALYSIS: EVs Continue to Deliver Strong Cost Savings Through 2024, Averaging $943 Annually Per Driver”
[9]. Atlas Public Policy. “COMPARING THE COST OF OWNING THE MOST POPULAR VEHICLES IN THE UNITED STATES: 2025 UPDATE”
This article provides information only and should not be construed as advice. It is provided without warranty of any kind.