Treasury, IRS say U.S. consumers saved $1 billion through EV tax credits since January

June 12 (UPI) -- The Treasury Department and the Internal Revenue Service said on Wednesday that U.S. consumers saved more than $1 billion in buying electric vehicles through federal tax credits since the start of 2024.

Federal officials celebrated the $1 billion milestone as a step in reaching clean energy goals. More than 150,000 vehicles were sold through the tax credit program established in the Inflation Reduction Act.

Electric car buyers receive tax credits up to $7,500 and $4,000 for new and used vehicles, respectively, at the point of sale. Officials said those savings continue with charging vehicles rather than using more expensive gasoline.

"President Biden's Inflation Reduction Act is lowering costs for electric vehicle purchases, with more than $1 billion in upfront saving for American consumers since January," Treasury Secretary Janet Yellen said.

"Consumers are saving up front and over time with $1,750 savings on gas and maintenance each year and $21,000 saved over the lifetime of the vehicle."

Federal officials in comparing a set of electric and gas-powered vehicles, the average cost of gasoline over 1,000 miles could cost up to $120 compared to $60 for electric versions.

The savings come after the Treasury and IRS released guidance last year allowing customers to cash in on the tax credit immediately during the sale instead of waiting until they file their annual tax return, which could be months later.

The tax credit program does come with a few exceptions. For example, the credit cannot be applied to vehicles sourced in Russia, China, Iran and North Korea in most circumstances. The Biden administration recently increased tariffs on Chinese EV vehicles, as well.