If you’re an Illinois resident and you're looking to buy an electric vehicle, you're in luck! Illinois offers a number of tax credits and incentives that are designed to make driving electric vehicles more affordable for residents.
Electric vehicle tax credits are designed to help Illinois reduce its reliance on fossil fuels and improve air quality. But as a personal benefit, these tax credits can help you save money on your electric car purchase and make it more affordable to own one. EV incentives can be combined with other state and federal tax credits, so you may be able to save even more money on your purchase.
Let's dig into the Illinois EV tax incentive details so you know what to expect when you buy your next electric vehicle!
Does Illinois Have an EV Tax Credit?
Yes, Illinois offers up to a $4,000 credit for new purchases of plug-in electric vehicles (EVs). These incentives are in addition to the Federal EV Tax Credit, which ranges from $2,500 to $7,500, depending on the model.
The state's Clean Vehicle Rebate Project (CVRP) is a competitive grant program that provides rebates to Illinois residents who purchase or lease new qualifying EVs. The Electric Vehicle Rebate Act defines an electric vehicle as “A vehicle that is exclusively powered by and refueled by electricity, must be plugged in to charge, and is licensed to drive on public roadways.” This does not include electric mopeds, electric off-highway vehicles, or hybrid electric vehicles and extended-range electric vehicles that are also equipped with conventional fueled propulsion or auxiliary engines.
The amount of tax credit you're eligible for will depend on the type of EV you purchase. While most EV cars qualify for the full $4,000 tax credit, EV motorcycles only qualify for a $1,500 tax credit.
How Does the EV Rebate Work in Illinois?
The EV Tax Credit is a dollar-for-dollar credit. When you buy a qualifying car in Illinois, the state will apply the tax credit to the purchase price of your vehicle. For example, if you buy a $30,000 EV and qualify for the full $4,000 credit, then it will reduce the price of your car by $4,000 after taxes.
| Purchase or Lease Timeframe | Rebate Amount |
| July 1, 2022 – June 30, 2026 | $4,000 |
| July 1, 2026 – June 30, 2027 | $2,000 |
| Beginning July 1, 2028 | $1,500 |
The EV Tax Credit can be applied only to vehicles registered with the Illinois Environmental Protection Agency as "electric drive." This includes all plug-in electric vehicles (EVs) and hydrogen fuel cell vehicles (FCVs)
Purchasers must apply for the rebate during an open rebate cycle and within 90 days of vehicle purchase. Applications are available here during open rebate cycles.
Eligibility requirements for an EV rebate in Illinois include, but are not limited to:
- The purchaser must reside in Illinois at the time of vehicle purchase and at the time the rebate is issued.
- The vehicle must be purchased from a dealer located in Illinois and licensed by the Illinois Secretary of State. (Rented or leased vehicles do not qualify for the rebate.)
- The vehicle cannot have been the subject of a previous EV rebate under this new program in Illinois.
- Only individuals can receive a rebate and can only receive one rebate. Businesses, government units, organizations, and other entities that are not individuals will be denied a rebate.
- The rebate amount cannot exceed the purchase price of the vehicle.
- The purchaser must retain ownership of the vehicle for a minimum of 12 consecutive months immediately after the vehicle purchase date.
- The purchaser must apply for the rebate within 90 days after the vehicle purchase date.
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Federal vs. Illinois EV Tax Credits
The Federal EV Tax Credit is available to all buyers of a new electric vehicle—up to $7,500, depending on the model—and can be combined with local and state incentives. This means that if you buy an EV in Illinois, the federal and state tax credits could total up to $11,000!
The $4,000 state rebate is only available for residents of Illinois who purchase an eligible vehicle from a dealership located within the state. If you purchase an EV and reside outside of Illinois, then the state credits where you buy the vehicle will apply to your purchase.
Additional EV Charging Incentives Offered in Illinois
In addition to the $4,000 rebate, Illinois residents may qualify for additional EV incentives related to energy use and home charging.
IRS EV Rebate
Consumers who purchase qualified residential fueling equipment between January 1, 2023, and December 31, 2032, may receive a tax credit of up to $1,000. Qualified alternative fuel vehicle refueling property is defined as any property (other than a building or its structural components) used for either of the following:
- To store or dispense an alternative fuel other than electricity into the fuel tank of a motor vehicle propelled by the fuel.
- To recharge an electric vehicle, but only if the recharging property is located at the point where the vehicle is recharged.
In addition, the following requirements must be met to qualify for the credit:
- You placed the refueling property in service during your tax year.
- The original use of the property began with you.
- The property isn’t used predominantly outside the United States.
- If the property isn’t business or investment use property, the property must be installed on property used as your main home.
Ameren EV Rate Program
Ameren Illinois is a utility company that offers an EV Reduced Rate Program when you charge an electric car at home. When you plug in during the Preferred Charging Periods (PCP), you save on electricity costs.
While standard service rates apply, there are different price periods or times of the day that influence your monthly bill while on this rate program:
- Preferred Charging Period (PCP): 11:00 p.m. - 7:00 a.m. A credit for your electric delivery service is given for every kWh of usage during this period.
- Non-Preferred Charging Period (NPCP): 11:00 a.m. – 7:00 p.m. During the highest one hour of household usage from the billing period that occurs within this timeframe, there will be an additional charge for each kWh used.
- Morning and Evening: 7:00 a.m. – 11:00 a.m. and 7 p.m. to 11:00 p.m. There are no additional credits or charges for electric usage during this time period.
- First-year Bill Credit: To offset potentially higher charges for usage during the NPCP, Ameren offers a monthly bill credit for your first 12 consecutive months enrolled on the EV Rate Program.
Electric Vehicle (EV) Charging Station Rebate
Beginning July 1, 2022, the Illinois Environmental Protection Agency (IEPA) will offer rebates to public and private entities for the installation and maintenance of Level 2 and direct current fast charging (DCFC) stations. Rebate awards may cover up to 80% of the eligible project costs.
Chevy Home Charging Installation Incentive
Chevrolet will cover standard installation of Level 2 charging outlets for eligible customers who purchase or lease a 2022 or 2023 Bolt EUV or Bolt EV in partnership with Qmerit (exclusions may apply). Standard installation costs and permit fees are fully covered by Chevrolet. Plus, even if you don’t qualify for the offer, Chevrolet and Qmerit can provide you with easy access to accredited home EV charging installers right in your area.
Want to see all EV charging incentives in your area? Check out the EV Charger Rebate Finder to search for rebates near you!
Who Qualifies for EV Incentives in Illinois?
EV tax credits are available to all Illinois residents, so you don't have to be a resident of Chicago or Cook County.
You can use the credit with any type of vehicle that qualifies as an EV, not just cars. This includes motorcycles, scooters, and even commercial trucks! Although, tax incentives differ depending on the type of EV you buy. For example, EV motorcycles only qualify for a $1,500 rebate.
Reasons to Drive an Electric Vehicle
As you can see, there are a lot of financial benefits when it comes to electric cars—but that’s not all! EVs offer their own set of benefits that add to the many reasons to buy an EV:
- Electric vehicles are better for the planet: Electric vehicles are 20-40 times cleaner for the earth than gasoline cars, according to the U.S. Environmental Protection Agency (EPA). That’s because they don’t emit any tailpipe pollutants, including carbon dioxide (CO2) and nitrogen oxide (NOx). These gases contribute to greenhouse gas emissions and air pollution, respectively.
- Electric vehicles are quieter: Instead of emitting noise from a car engine, EVs run quietly on their electric motors—and most models don't even have a transmission or exhaust system! You can enjoy a peaceful ride without a loud engine.
- Electric vehicles will save you money: EVs are cheaper to operate than gasoline cars due to lower fuel costs per mile. In addition, they require less maintenance over time since most don’t have internal combustion engines. Paired with Illinois rebate programs, you’ll save thousands in the long run.
Illinois Is Committed to Making EVs More Accessible
Illinois is one of the leading states for EV adoption, with more than 230,000 EVs registered in the state. As part of its effort to make EVs more accessible, Illinois has a number of incentives and charging stations. The state’s commitment to clean energy can be seen in its commitment to electric vehicles and its willingness to work with local dealerships and utility companies to make EVs more accessible.
Diepholz Auto is your trusted dealer for all things electric. If you're ready to buy an electric car, check out our Priority Purchase program to build and customize your perfect vehicle.
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