Electric vehicle tax credits, discounts, and rebates in Colorado

(Qualified Plug-in Electric Drive Motor Vehicle Credit)

• How much? Up to $7,500 – Expired September 30, 2025
• Eligible Coloradoans: Individuals with an income of $150,000 or less or married joint filers with income of $300,000 or less
• How it works: This credit can be applied to your federal income taxes, reducing the amount owed on those taxes by the amount of the credit. However, the credit is nonrefundable, meaning you can’t get back more on the credit than you owe in taxes and you can’t apply any excess credit to future tax years.
• Eligible EVs: New EVs or plug-in EVs manufactured in the United States and costing less than $55,000 for a car and $80,000 for an SUV, van or truck
  • There is a partial credit of $3,500 for vehicles that only meet some of the eligibility criteria 
  • List of eligible vehicles for the federal EV tax credit
• More information: https://www.irs.gov/credits-deductions/credits-for-new-clean-vehicles-purchased-in-2023-or-after 

• How much? 30% of the sale price up to a maximum credit of $4,000 – Expired September 30, 2025
• Eligible Coloradoans: Individuals buying the vehicle from a licensed dealer, for use and not for resale
  • Modified adjusted gross income (AGI) may not exceed:
    • $150,000 for married filing jointly or a surviving spouse
    • $112,500 for heads of households
    • $75,000 for all other filers
• How it works: This credit can be applied to your federal income taxes, reducing the amount owed on those taxes by the amount of the credit. However, the credit is nonrefundable, meaning you can’t get back more on the credit than you owe in taxes and you can’t apply any excess credit to future tax years.
• Eligible EVs: Used EVs or plug-in EVs with a sale price of $25,000 or less, purchased from a licensed dealer. Sale prices includes all dealer-imposed costs or fees not required by law but doesn’t include costs or fees required by law, such as taxes or title and registration fees.
  • Have a model year at least 2 years earlier than the calendar year when you buy it. For example, a vehicle purchased in 2025 would need a model year of 2023 or older.
  • Click here to see if a vehicle is eligible.
• More information: https://www.irs.gov/credits-deductions/used-clean-vehicle-credit

(Innovative Motor Vehicle Tax Credit)

• How much? Up to $6,000:
  • $3,500 for EVs or plug-in hybrid vehicles that cost less than $80,000 MSRP
  • An additional $2,500 for models that cost less than $35,000 MSRP
• How it works: Refundable, so buyers can get the full benefit even if they don’t pay that much in state income taxes;
  • Buyers can get the credit upfront from dealers, who then file the paperwork and get the credit at a later date
  • Can be used together with the federal EV tax credit

• Eligible Coloradans: Any Colorado resident who purchases or leases an eligible vehicle
  • Vehicle must be titled and registered in CO

• Eligible vehicles: New electric vehicles and plug-in hybrid electric vehicles
  • Available for both purchases and leases
• How long? 
  • $3,500 through 2025
  • The credit will continue through 2028, although the amounts from 2026 through 2028 will be determined based on revenue forecasts. 
• More information:
  • Colorado Energy Office: https://energyoffice.colorado.gov/transportation/grants-incentives/electric-vehicle-tax-credits 
  • Tax credit details: https://tax.colorado.gov/sites/tax/files/documents/ITT_Innovative_Motor_Vehicle_Credit_Jun_2023.pdf

• How much? 
  • $4,000 (used EV), which will increase to $6,000 on November 3, 2025.
  • $6,000 (new EV), which will increase to $9,000 on November 3, 2025. 
• How it works: This is a point-of-sale rebate, meaning the dealer deducts the amount of the rebate from the total cost at the time of purchase 
  • Available at participating dealerships only (scroll to the very bottom of this website to see a complete list of participating dealers)
• Eligible Coloradans: Those who make less than 80% of the area median income (around $69,000 for an individual or $100,000 for a family of four in the Denver metro area). 
• Eligible cars and trucks: Operational gas- or diesel-powered vehicles that are at least 12 years old OR have failed an emissions test
• How long? The program will continue to accept applications until funds are exhausted. 
• More information: Vehicle Exchange Colorado (VXC) Program | Colorado Energy Office
  • Phone: 833-933-9602
  • Email: [email protected]

• How much: $500 for eligible Xcel customers or up to $1,300 for income-qualified customers
• How it works: Rebates can help reduce the costs of updating your home’s wiring as well as offset the cost of a Level 2 charger
• Eligible Coloradans: 
  • Drive an electric vehicle (all-electric or plug-in hybrid)
  • Live in a residence that receives electric service from Xcel Energy in Colorado
  • Agree to charge during an off-peak schedule through Xcel’s  Optimize Your Charge Program

• More information: https://ev.xcelenergy.com/home-wiring-rebate 

• EV charging stations are exempt from property tax until January 1, 2030.
• More information: https://afdc.energy.gov/laws/13266