Final Months: Federal EV Tax Credits Expire Soon

August 7th, 2025 by

Federal EV Tax Credit Update

Recent legislation passed by Congress on July 3, 2025, has accelerated the expiration of federal electric vehicle (EV) tax credits. Both the $7,500 credit for new EV purchases or leases and the $4,000 credit for used EVs will now expire on September 30, 2025. This ends the extensions originally planned under the Inflation Reduction Act, which had set these incentives through 2032.

To qualify for these credits, you must purchase or lease and take delivery of your Electric Vehicle by September 30, 2025. These credits can be applied directly at the point of sale through dealer assignment.

Colorado State EV Incentives

In addition to the federal tax credits, Colorado offers state incentives to support EV ownership. Eligible new battery electric vehicles (BEVs) and plug-in hybrid electric vehicles (PHEVs) with a manufacturer’s suggested retail price (MSRP) of $80,000 or less qualify for a $3,500 state credit. Vehicles with an MSRP of $35,000 or less may qualify for an additional $2,500 incentive.

These state credits can be applied at the dealership and can be combined with federal incentives to increase your savings.

Vehicle Exchange Colorado (VXC) Program

The VXC program helps income-eligible Coloradans trade in older, high-emission vehicles for rebates on new or used EVs. This initiative encourages cleaner air and more affordable EV access.

Eligibility includes:

  • Colorado residency, age 18 or older, with a valid Colorado driver’s license and address 
  • Household income at or below 80% of the Area Median Income (AMI) or enrollment in qualifying assistance programs (such as SNAP, SSI, Medicaid) 
  • The vehicle being traded in must be at least 12 years old or fail emissions testing, and it must be currently titled and lien-free in your name with the Colorado DMV 

Rebates available:

  • $6,000 for new BEVs and PHEVs 
  • $4,000 for used BEVs and PHEVs 

New EVs must have an MSRP of $80,000 or less. Used EVs must have a final negotiated price of $50,000 or less.

These rebates are point-of-sale discounts available at participating dealerships and can be stacked with federal and state credits.

How to Apply for VXC

You can register and apply for the VXC program online. Applications are reviewed within approximately 10 business days. Once approved, rebates must be redeemed at the dealership within 90 days.

Potential Savings Overview

Incentive Program Amount Deadline
Federal EV Tax Credit $7,500 (new) / $4,000     (used) September 30, 2025
Colorado State Credit         Up to $6,000 Active (subject to change)
Vehicle Exchange Colorado (VXC) $6,000 (new) / $4,000 (used) Program active through 2032

Total potential savings can reach up to $19,500.

Shop Electric Vehicles at Schomp Hyundai

At our Hyundai dealership, we’re here to help you navigate these savings opportunities and find the electric vehicle that fits your needs. With Hyundai’s award-winning lineup of electric and hybrid vehicles, including the IONIQ series, you’ll find cutting-edge technology and exceptional value. Remember, to secure the federal tax credits, your purchase or lease must be completed with delivery by September 30, 2025.

Visit us at our Hyundai store or contact our sales team today to learn more about our electric vehicle lineup and available incentives.

Posted in Automotive, News