Alternative Fuel Vehicle Refueling Property Credit:Does My Business Still Qualify?

Since the Energy Policy Act of 2005, the Federal Government has implemented numerous tax credits and incentives for businesses to invest in alternative vehicle refueling property to decrease our country’s dependence on fossil fuels. For the past several years, businesses could receive a credit of the lesser of 30% or $30,000 of alternative fuel vehicle refueling property placed in service at each location of their business via Form 8911. With the passing of the Inflation Reduction Act of 2022, several changes have been made to this credit beginning in 2023.

What are the changes to the credit for 2023?

• The credit limit has been raised to $100,000 per piece of property, not per location
• Property must be located in an eligible census tract, defined as the following:
• Not an urban area according to the most recent US Census, or
• Described in section 45D(e) of the US Code – a low-income community/census tract
• The credit defaults to 6% of the purchase price but can increase to 30% by meeting one of two criteria:
• The project was started prior to January 29, 2023, or
• If the project was started after this date, it satisfies the new prevailing wage and apprenticeship requirements

Determining qualification two-test, two-step process. Take the test here.