Minnesota EV Tax Credit: Everything You Need To Know
Minnesota has a relatively slow adoption rate when it comes to electric vehicles. Around 20 electric cars are sold for every 10,000 residents in Minnesota. So, why is this?
At a Glance:
1️⃣ Minnesota does not currently have a state-specific tax credit for electric vehicles.
2️⃣ MN Residents may be eligible for the federal EV tax credit.
3️⃣ Vehicles purchased between November 1, 2019, and October 31, 2022, could be eligible for toll credit.
4️⃣ Most of Minnesota’s EV incentives are provided by utility companies.
Minnesota is not the most electric vehicle-friendly state. This can be seen in their policies and lack of rebates.
However, as a state resident, you could still be eligible for a few incentives, and I recommend reading through this article to find out more.
The EV Tax Credit In Minnesota Explained
Minnesota does not have a tax credit for residents who own an electric vehicle. However, you may still qualify for the federal tax credit. The federal tax credit is not state specific and covers the entire USA. The tax credit is up to $7500 for eligible applicants.
Many people confuse the Minnesota Toll Credit Pilot Program for a tax credit. The toll credit program gave electric vehicle owners a rebate of up to $250 in credit for toll road usage. Unfortunately, the program was a pilot and has been suspended.
Does Minnesota Have An EV Charger Rebate?
State policies around electric vehicles and chargers do not include any rebates for installing an EV charger, at least for now.
That said, most utility providers in the state provide some rebates and incentives. We will discuss that further down.
A meeting was held on the 13th and 14th of October 2022 regarding the future of the state’s plan to build more infrastructure related to electric vehicles.
The outcome of those meetings is still to be determined, but it could be possible that a rebate could be offered in the future for installing an electric vehicle charger.
Minnesota Utility Benefits For Electric Vehicle Owners
The state isn’t keen on offering too many tax incentives for people who go green with their cars. However, there are a few utility incentives.
It is important to note that you need to be a customer of a utility provider to be eligible for whichever rebate they offer.
|Utility Provider||Rebate On Offer|
|Xcel Energy||$500 rebate for residential customers who install a Level 2 EV charging station.|
|Minnesota Power||$250 rebate for residential customers who install a Level 2 EV charging station.|
|Otter Tail Power Company||$250 rebate for residential customers who install a Level 2 EV charging station.|
|Dakota Electric Association||$500 rebate for residential customers who purchase a new or used EV.|
|Connexus Energy||$500 rebate for residential customers who purchase a new or used EV|
|Great River Energy||$500 rebate for residential customers who purchase a new or used EV|
|Stearns Electric Association||$500 rebate for residential customers who purchase a new or used EV|
|Wright-Hennepin Cooperative Electric Association||$500 rebate for residential customers who purchase a new or used EV|
|Lake Region Electric Cooperative||$500 rebate for residential customers who purchase a new or used EV|
If no link is provided for your utility provider, the best thing to do is call them directly.
In addition to your utility, there is the Federal EV charger tax credit to consider, which also forms part of the Inflation Reduction Act.
How To Claim Minnesota EV Benefits
To claim benefits from your utility provider, it is best to call them or follow one of the links above.
As mentioned, the state of Minnesota does not offer a tax credit, but if you want to apply for the federal tax credit, follow these steps:
1️⃣Make sure your electric car is eligible for the tax credit. The car must be new and an eligible plug-in electric vehicle. You can find a list of eligible vehicles on the IRS website.
2️⃣Get confirmation from the car dealer or manufacturer that your car is eligible for the tax credit.
3️⃣Fill out the IRS form 8936. The “Qualified Plug-In Electric Drive Motor Vehicle Credit ” form will calculate your tax credit.
4️⃣Include this form with your federal income tax return for the year in which you bought the car. You can only get a credit up to the amount you owe in taxes.
5️⃣Keep all the papers that prove you bought the electric car and the tax credit you claimed.
These are highly summarized steps, so speaking to your tax consultant for more detailed advice is best.
What Are The Benefits Of Minnesota’s EV Incentives
The benefit of receiving incentives from the state, the federal government, or a utility provider is that it pushes the use of alternative fuel vehicles, including battery electric and plug-in hybrid electric vehicles.
In many states, offering incentives promotes a greener planet and boosts the economy by encouraging businesses to cater to electric vehicles. This is because many incentives promote the use of American-made components.
Finally, I like to see it as a snowball effect. The more people that buy electric vehicles, the better these vehicles will become, and so more people will look to buy one.
Is Minnesota A ZEV State?
Minnesota has been a ZEV (Zero Emission Vehicle) state since 2019. The aim is to encourage more people to buy electric vehicles (EVs) and reduce pollution.
Car manufacturers have to make more EVs each year, and there are rebates and tax credits to help people buy or lease them. Also, there are grants for charging stations, and certain EV types can use HOV lanes.
Not all states implement all incentives, but Minnesota does have a National Electric Vehicle Infrastructure Plan.
Can You Claim The VAT Back On A Tesla?
In most states, you cannot claim the VAT back on purchasing any car, regardless of whether or not it is electric. This is true if the vehicle is used for personal use.
If your Tesla is used for the business, getting some return on your VAT is possible. However, using a reputable tax consultant is advisable as claiming that back is often tedious.
Let’s break down the key takeaways from this article:
1️⃣ Minnesota does not have a state-specific tax credit for electric vehicles, but residents can apply for the federal EV tax credit.
2️⃣ Most of Minnesota’s EV incentives come from utility companies, which offer rebates and incentives for EV owners.
3️⃣ Minnesota is a ZEV state, and the state’s incentives promote the use of alternative fuel vehicles to reduce pollution and boost the economy.
🎓 Disclaimer: This article is accurate at the time of publication in 2023. Please reference the publication date to determine whether any rebates or schemes still apply.