Credits, rebates, and other incentives for EVs go beyond the Federal Tax Credit for Clean Vehicles. Plenty of states have their own goals when it comes to clean energy and automobiles, and consumers can benefit on the state and local level from a number of programs designed to encourage the switch from internal combustion engines to electric vehicles.
In this article, we’re going to take a quick look at California’s state and local incentives. We’ll discuss the terms of the California Clean Vehicle Rebate, how to find local incentives for EV buyers, and what to do if you don’t qualify for EV rebates in California.
California’s EV Tax Credit – Clean Vehicle Goals
As one of the most outspoken states on the subject of climate change, California boasts rebates for both new EV purchases and, in some areas of the state, for used EVs and home charging station installations.
If you haven’t already heard, here’s the “why” behind California’s EV incentives: the state plans to eliminate the sale of all gas-powered vehicles by 2035. To help encourage residents to ditch fossil fuels and go electric, California has aimed several incentives at EVs. Over time, these incentives have become more restricted to lower priced EVs and lower income buyers or, in some cases, phased out altogether.
Let’s take a look at California’s current state-level incentives first:
State Level Incentives: California EV Rebates and Grants
Before we get started, we want you to know that this article is for informational purposes only, and is not intended to provide, and should not be relied on for, financial, tax, legal or accounting advice. We’re experts in EVs, not tax law. Please consult your own accounting, tax, and legal advisors before engaging in any transaction.
California Clean Vehicle Rebate Program
The major clean vehicle program with the highest value to EV buyers in the Golden State is the Clean Vehicle Rebate Program (CVRP). Technically, this isn’t a California EV credit: it’s a rebate. Unlike a federal tax credit (a non-refundable amount that reduces your tax burden), the rebate amount is paid to you by a check from the program in the amount that you’ve qualified for. For Battery Electric Vehicles (BEVs), the rebate offered is worth $2,000. Additionally, an increase of $5,500 (formerly $2,500 for 2022) can be added to the rebate for applicants who meet the appropriate criteria for low-to-moderate income families (based on 400% of the 2023 Federal Poverty Level).
How can you get the California EV rebate? It’s not too complicated: you must reside in California, file an application on time, meet the right income criteria, and buy a new, qualifying EV. Let’s take a look at each step:
First, you must be a California resident to qualify. Seems like a no-brainer requirement, but there are some features of the rebate that make this requirement notable. A major part of the terms and conditions for CVRP eligibility is the 30-month clause: the EV must remain in the hands of the individual applying for the rebate for 30 consecutive months and operate in the state of California. The EV must also be registered with the California DMV for that length of time. If you move out of state or try to sell the EV before the 30-month time frame is up, you may have to reimburse the California Air Resources Board with your rebate amount.
Second, you’ll have to apply for the rebate before funding for the program is exhausted. California has set aside a fixed amount of rebate money for the CVRP project, and getting your application in doesn’t guarantee that you’ll receive a rebate. However, the program may put you on a waitlist to receive future rebate funding provided your application and supporting documents were submitted in order and on time. You can check the currently-available CVRP funding amount here.
Next, you’ll need to file your application with the CVRP within 90 days of purchasing or leasing a qualifying EV. Supporting documentation, such as a copy of your EVs registration, your purchase contract, a copy of your driver’s license, must be submitted within 14 days of the application’s submission.
What are the income requirements for the CVRP? This requirement has changed quite a bit over the life of the CVRP, but gross income thresholds for California’s EV rebate eligibility in 2023 are as follows:
- Less than $135,000 for single filers
- Less than $175,000 for head of household filers
- Less than $200,000 for joint filers
Sometimes, the program will ask for a verification of your income as they review your application. This can be handled with a copy of your W2 (and your spouse’s, if applicable). For further guidance on eligibility, you can check out the current eligibility guidelines here.
Which Vehicles Qualify for the California EV Rebate?
Note: Tesla adjusted pricing across all models on January 12, 2023, putting the Model 3 and Model Y (assuming it is classified as an SUV) back within qualifying prices for the California EV rebate. At the time of writing, this is not yet reflected on the California Air Resources Board website, but that may be updated soon.
Here is a list of EVs that do qualify for the CVRP rebate:
- 2022 Audi Q4 e-tron Quattro
- 2022 Audi Q4 e-tron Sportback Quattro
- 2020-2021 BMW i3
- 2022-2023 Chevrolet Bolt EUV
- 2020-2023 Chevrolet Bolt EV
- 2022-2023 Ford F-150 Lightning
- 2021-2023 Ford Mustang Mach-E
- 2022-2023 Hyundai IONIQ 5
- 2020-2021 Hyundai IONIQ Electric
- 2020-2023 Hyundai Kona Electric
- 2022 Kia EV6
- 2020-2023 Kia Niro Electric
- 2022-2023 Mazda MX-30 EV
- 2022 Mercedes Benz EQB 300-4M
- 2022 Mercedes Benz EQB 350-4M
- 2020 – 2023 MINI Cooper SE
- 2023 Nissan Ariya
- 2020-2023 Nissan LEAF
- 2020-2023 Nissan LEAF Plus
- 2023 Subaru Solterra
- 2023 Toyota bZ4X
- 2021- 2023 Volkswagen ID.4
- 2022 Volvo C40 Recharge
- 2021 – 2022 Volvo XC40 Recharge
Qualifying Tesla models (see note above) may, in the future include:
- 2023 Model 3*
- 2023 Model Y*
- 2023 Model Y Long Range*
- 2023 Model Y Performance*
*We were made aware of an email response by CVRP staff from a reader in January 2023 that stated the following:
Vehicle manufacturers must apply for Clean Vehicle Rebate Project (CVRP) eligibility with the California Air Resources Board (CARB) and meet a number of program requirements. If all program requirements are met, the vehicle is added to the list of eligible vehicles on our website. At this time, they have not applied.
Please note: Certain plug-in hybrid electric vehicles (PHEVs) are only eligible for a rebate if they are purchased/leased on or after the vehicle eligibility date.
We cannot guarantee a vehicle will be approved by CARB and added to our eligible vehicle list. Therefore, if the rebate is an important factor in your decision to purchase/lease the vehicle, we recommend that you use your best judgment given the information provided on our website.
If you ordered a Tesla Model 3 and Tesla Model Y on or before March 15th, 2022 the vehicle may still be eligible for the program. If you ordered your Tesla on or after March 16th, 2022, you are no longer eligible to apply for the program.
Tesla has been in contact with the California Air Resources Board (CARB) and made this decision to remove themselves from the Clean Vehicle Rebate Project (CVRP). CARB will not be adjusting their MSRP cap to allow Tesla vehicles to qualify for the program. No exceptions can be made to this requirement. All concerns regarding the MSRP increase should be directed to Tesla.
I encourage you to visit www.driveclean.ca.gov where you can perform a search based on your vehicle type and zip code to see if there are any other incentives available to you at this time. Thank you for your investment in clean vehicle technology.
Thus, it seems that Tesla has yet to be fully eligible for CVRP, although this may be subject to change at any time.
For additional information on the program, visit https://cleanvehiclerebate.org/en. For a more detailed explanation regarding documentation and submission guidelines, check out the CVRP Terms and Conditions page.
Clean Vehicle Assistance Program
Another avenue of assistance for EV buyers with low-to-moderate incomes is the California Clean Vehicle Assistance program. Instead of a credit or a rebate, this incentive technically qualifies as a grant. Like the CVRP, the Clean Vehicle Assistance Program requires you to file an application, provide documentation, and meet income thresholds. Unlike the CVRP, however, you must be approved for the Clean Vehicle Assistance Program before you buy a qualifying EV.
You’ll be limited to buying a qualifying EV from a Clean Vehicle Assistance Program approved network dealership in order to actually redeem your grant. But one major benefit to this program is that used EVs purchased from an approved dealership also qualify for the grant.
For a step-by-step view of the Clean Vehicle Assistance Program process, click here.
California Clean Fuel Reward
A second incentive that California has offered in the past is the Clean Fuel Reward, which provides an additional $750 to consumers who purchase a qualifying EV from a participating dealership. However, at the time of writing, the Clean Fuel Reward program is effectively inactive (the reward amount has been reduced to $0).
From what we can see, there may be a return of the reward program in the future, but the terms have not been finalized. Still, it’s worth keeping an eye out for if you are planning on buying an EV in California sometime in the next few years.
County-Level Incentives: California Rebates for EVs
California’s county-level incentives for EVs are too numerous to list here. They range from assistance with new or used EV purchases to rebates or grants for the installation of home charging systems.
For example, the San Joaquin Alternative Fuel and Advance Vehicle Rebate offers up to $3,000 for qualifying new or leased EVs to residents of the area. In Antelope Valley, the Electric Vehicle Rebate offers $500 to residents of the area who purchase any EV (we assume they also mean used) through Antelope Valley dealerships.
For further incentives listed by county, visit https://driveclean.ca.gov/search-incentives
What if the California Tax Credit Doesn’t Apply to Me?
Whether your income prices you out of the California EV rebates, your location doesn’t have great EV options in your price range, or if you have your heart set on a Tesla Model 3 or Model Y (yeah, we wish the CVRP included them, too), we’re here to help!
Check out our huge selection of used EV listings to find options for that clean electric vehicle you’ve been dreaming about. From used Tesla Model 3s to used Ford Mustang Mach-Es, Find My Electric has something for your budget and your lifestyle.
We keep our used EV listings free of clutter with filtering and sorting features to get you right to the used EV you’re looking for. Don’t waste your time digging through other sites that list ICE cars right next to clean EVs, check out our listings to find your next ride today!