Alabama EV Incentives and Tax Breaks

If you’ve been wanting to get an electric vehicle (EV) but were put off by the prices, you may be in luck. There are several incentives and tax breaks available that may make purchasing an EV much easier for residents of Alabama. Below, we’ll explain some of the programs available and give you some suggestions for EVs to explore.

Federal Tax Credit for Electric Vehicles

There’s a nationwide program offering consumers a tax credit when they purchase an EV. This means that if you’re purchasing an EV in Alabama, you may be eligible for this program.

How Much Can You Save?

With the federal tax credit, you can save up to $7,500 on your next electric or plug-in hybrid vehicle. The exact amount you’ll save depends on the capacity of the battery. For example, if you purchase a new 2023 Hyundai IONIQ 5, you’ll receive the full $7,500 tax credit. If you were to opt for a Hyundai IONIQ plug-in, however, you’d only receive a credit of $4,543. You can look up the exact credit amount for any vehicle through the Department of Energy’s website.

Program Eligibility

To be eligible for the tax credit, a vehicle must meet a few requirements. Some of these include:

• The vehicle must be made by a manufacturer and not converted into an EV.
• It must have a gross vehicle weight rating of not more than 14,000 lbs.
• It must be propelled a significant amount by an electric motor that draws electricity from a battery.
• The battery must be rechargeable and have a capacity not less than 4 kilowatt hours.
• The vehicle must be acquired for use by the taxpayer and not for resale.

Generally speaking, any recently made EV or plug-in hybrid vehicle will fit these requirements. If you’re unsure if a specific vehicle meets the program eligibility requirements, you can either search for that specific vehicle on the Department of Energy’s website or visit a local dealership for more information.

Recent Program Changes

With the recent passage of the Inflation Reduction Act of 2022, there were a few changes made to the credit amounts and requirements for clean energy vehicles. For example, if you purchased a qualifying vehicle before August 16, 2022, but did not take possession of it until after that date, you may still claim the EV credit based on the rules that were in effect before then.

This law may also impact 2022 and 2023 year models, depending on where they are assembled. When shopping for a new EV, speak with the finance department at your local dealership to ensure you know exactly which credits you’re eligible for before purchasing.

Discounted EV Rate Program in Alabama

While some states offer their own tax incentive programs for EVs, Alabama does not. However, there’s a program available that can help lower the costs associated with owning an EV. If you’re a customer of Alabama Power (one of the largest providers in the state), then you can sign up for their discounted EV rate rider.

With this program, you’ll receive a discounted rate on your electricity if you charge your EV during off-peak hours (9 p.m. to 5 a.m.). Since most people choose to charge their EVs overnight anyway, this is a great way to save money on your electric bill. To sign up for this program, you’ll need to provide the company with documentation verifying your ownership of a qualifying EV.

Other Benefits of Electric Vehicles

The federal tax incentive program and the discounted electricity rate are two great reasons to purchase an EV in Alabama. However, there are some other great advantages besides the initial cost savings. For example, when you decide to go with an EV or plug-in hybrid, you don’t have to worry as much about gas. With gas prices always in flux, you can save yourself a significant amount of money by not needing as much of it or not needing any at all.

Besides that, when you purchase an EV, you’re buying something that was made within the past few years. Because of this, you’re getting a vehicle that likely has some of the latest comfort, entertainment, performance, and safety features. You’ll not only get an energy efficient vehicle but one that’s enjoyable to drive for a long time to come.

Finally, EVs are simply better for the environment. By not burning as many fossil fuels, you help to keep the air clean and protect the earth. It may only be a small amount per person but every little helps.

Great Electric Vehicles to Consider in Alabama

If you’re interested in getting an EV in Alabama, there are some great options to consider. Two great vehicles to explore are:

The 2023 Hyundai IONIQ 5

The IONIQ 5 is an electric SUV with a spacious interior, long driving range and excellent performance. With the IONIQ 5, you can get features such as all-wheel drive, up to 303 miles on a single charge, an augmented reality display, and an a 12-inch touch screen infotainment display. If you’re looking for the comfort and versatility of an SUV, combined with the efficiency of an all-electric vehicle, this is the option to explore.

The 2023 Hyundai KONA Electric

The 2023 Hyundai KONA Electric is another SUV, although this one is a little smaller than the IONIQ. Because it’s smaller, it’s also more affordable. Still, it comes packed with features, such as plenty of cargo space in the rear, an available premium audio system, and a standard 201 horsepower motor. Take a look at the 2023 Hyundai KONA Electric if you want an affordable electric SUV without sacrificing quality.

Learn More About EVs in Alabama

If you want to learn more about buying an EV in Alabama, the team at Hyundai of Auburn can assist you. Our team would be happy to answer any questions you may have about available incentive programs or show you any of the EVs that we have in stock. Please feel free to contact us at any time or stop by our dealership at your convenience.

Image by Stephen Kidd is licensed with Unsplash License