Header image alt text

www.ElectrifyAtlanta.com

Electric Vehicle information for Atlanta and Georgia

EV tax credits

Sections below:
– EV tax credits (both federal and state)
– HOV lane access
– annual road-use fee
– the current threat to the state tax credit
– defending the state tax credit


There are two very different tax credits that apply to the acquisition of an electric vehicle: a federal tax credit and a Georgia state tax credit.

Federal tax credit:
– $7,500 for nearly all plug in cars, whether pure electric like the Leaf or “range extended” like the Volt; some gas hybrids like the Ford Energi models get only partial credit
– can NOT be carried over year to year — you need $7500 of federal income tax liability in a single year to maximize this credit
– use IRS form 8936 (not 8834)
– If you are leasing, you don’t need to worry about any of the above details (tax liability or IRS paperwork). The tax credit is already rolled into your lease in the form of a lower payment. The leasing bank takes the credit and passes it through to you in the lower lease cost.
– valid for the first 200,000 cars produced by each manufacturer, and then will take about a year to fully phase out, so this will still be a big factor for a couple more years at least; see this long but excellent analysis of when we think the tax credits will start to phase out for each manufacturer

Georgia tax credit:
– … is an income tax credit (not deduction!) of $5000 for pure electric cars only (e.g. Leaf yes, Volt no)
– … CAN be carried over year-to-year for five years, which is useful if you don’t have $5000 of state tax liability in a single year
The Georgia paperwork process is described in both of these links:
http://epd.georgia.gov/air/alternative-fuels-and-tax-credits
http://epd.georgia.gov/air/sites/epd.georgia.gov.air/files/2015%20LEVTAX%20Fact%20Sheet%20REVISED%202015_09.pdf
– Unlike the federal credit, for the state credit you DO need to file your own paperwork, even if you are leasing; if a dealer tells you otherwise, politely ignore them because they are confused.
– The state tax credit ended July 1st 2015 however as long as you bought or leased your EV before that date you still qualify for the credit
You need to file a form with the state environmental office at least a month before you file your tax return! Read the instructions linked above. If you put off your tax paperwork until early April you may find that you are doing so too late to collect the state tax credit.

These are not tax deductions, rather tax credits. Assuming you have enough tax liability, this is basically cash in your pocket, typically in the form of a refund check after your file your return(s).

Many people misunderstand the concept of a tax credit, or don’t realize how much state or federal income tax they pay every year. The incentives above are tax credits, which are far more valuable than just tax deductions. When looking at your tax liability to the US or to Georgia, look for the “total tax” line on your most recent tax return — NOT the refund or amount-due line! The total tax line is the actual tax you’ve been paying. The refund / amount-due line is what was left over after your paycheck withholdings were accounted for. Don’t mix up these two numbers! Anyone can get these tax credits, even if on a limited income with very little tax liability.

All major tax preparation software packages support the various forms required to collect these tax credits.


HOV lane access

EV owners in Georgia can get free, single-person access to the HOV lanes. Details:

– you need to get a special “alternative fuel vehicle” (AFV) license plate for your car; you do NOT qualify for the lane access just by owning the car; you need to register it and get the plate

– the plate does cost an extra $35 per year; this is to compensate the state for the fact that you aren’t paying gasoline taxes

– the pay HOV lanes (aka High Occupancy Toll or HOT lanes) are free, but you need to A) get a PeachPass account and transponder/tag for your car, and then B) get the account switched to “non toll” status


annual road-use fee

The opposite of a perk would be a penalty …

In the 2015 session, state legislators passed a mammoth transportation bill that included a new $200 fee for EV owners. In theory it was to compensate for the fact that EVs don’t buy gasoline and therefore don’t pay for road maintenance, which is funded by state taxes on gasoline. However, EV owners have howled in protest over this because the $200 number they picked is wildly unfair. If you do the math, a comparable car’s annual gas usage results in $50-$85 in taxes paid, and most EV owners are perfectly willing to pay that kind of fee. But $200 is more than the worst pickup truck or SUV would pay in gas taxes, and those heavy vehicles do much more damage to the roads than a typical car.

That said, the law just passed in April 2015 and it will take a while for the state bureacracy to put it into effect. Once the fee does appear on registration bills, Georgian EV owners have vowed to take the state to court over it. A similar situation happened in Virginia in 2014 and citizens there were able to get it changed. So hang in there, this fight isn’t over yet.


The 2015 threat to the state tax credit

The Georgia legislation that enabled the state tax credit many years ago did not have a sunset provision, or a budgetary cap. However, it was only in 2011 that usable EVs finally arrived on the market and more and more people started claiming the credit, and within a couple years state legislators started to notice the growing line item in the state budget. In the 2014 session of the state legislature, the credit nearly got killed outright, and was only saved in the last hours of the session. The credit was eventually killed in the 2015 session, despite concerted efforts during 2014 that resulted in proposed compromise legislation (HB 220) that ramped down the tax credit.

This Atlanta EVDC article summarizes how terrible the 2015 session was for EV policies.

Here’s another post-mortem by Maria Saporta — “we have managed to go from being among the best to the worst in just one legislative session.”

During the 2015 legislative battle, I put together the information below to provide resources to assist YOU, the citizen, in explaining to your state legislators (and neighbors, and coworkers, and strangers …) why EV-friendly policies are good for Georgia.

GAEVCredit.com — this website was launched in early 2015 by the people who had worked to create some compromise legislation. The end result of their work was HB 220, a bill that provided a “workable compromise” to gradually sunset the tax credit and also address some unfair parts of the old legislation. See this website for information about that bill and how the tax credit benefits all Georgians.

www.UCSUSA.org/ElectricVehiclesGeorgia — The Union of Concerned Scientists (UCS) is a national organization that is helping us get the word out to Georgians about the benefits of EVs. This link takes you to excellent material in support of continuing the tax credit and information about how EVs are a good choice in general.

“Electric Vehicles and Georgia (2015)” — accessed via the main UCS link above, this four-page fact sheet summarizes the main reasons to support EV-friendly polices in Georgia, including:
– EVs are cheaper to fuel
– EVs keep more money in the state
– EVs are cleaner (even when powered by a dirty power grid)
– EVs pair well with renewable energy sources

Comparison table of three bills in Georgia House (HB 122, HB 176, HB 220) — this excellent table will help you make sense of the different bills being considered; note that HB 220 is the consensus bill that is gathering the most support. This table comes from this article from the Atlanta EVDC. Note that this table is from mid February and may be dated information at any time after then, since the legislative situation can change quickly.

EV tax policy defense talking points and Transportation Committee contact lists (Google Doc)

Impact of Elimination of the Electric Vehicle Tax Credit on the Georgia State Economy, a report that shows how eliminating the tax credit would negatively impact Georgia’s economy by hundreds of millions of dollars over the coming years. The report was commissioned by a nonpartisan group of business executives and retired senior military leaders concerned about global energy security, known as Securing America’s Future Energy (SAFE).

Below are two articles by Tim Echols, member of Georgia’s Public Service Commission and a happy EV owner. Each of these serves as a fantastic collection of quick talking points to review with any state legislator (or your neighbor, or your Facebook friends), reasons why we should keep the EV tax credit.

Why Retain the ZEV/LEV Income Tax Credit In Georgia?

Keep Georgia’s EV tax credit in place

(in the second link, Mr. Echols’ position is followed by that of a state rep who wants to kill it)

In summary:
– EVs keep more money close to home instead of sent to oil companies out of state or overseas.
– The tax credit received comes back after we file our taxes as a refund, and then gets spent. It buys things in Georgia like clothes, appliances and services.
– EVs fit nicely with our electric grid here. Overnight charging takes advantage of the excess capacity we have at those times.
– EVs help Atlanta’s smog problem and will help us get back in compliance with the EPA.
– EVs send a strong message to millennials about our priorities. This investment makes Atlanta a more livable city where people want to be.

And I’ll quote the first article’s closing paragraph in total, because it’s so good:

Nissan is having great success with the LEAF and Georgia is the 2nd largest market in the U.S. for all EVs. But behind Nissan, BMW, Kia and many other manufacturers are coming with electric cars. Our message to the legislature needs to be to hold off for another year before taking action. Let’s allow the other manufacturers to benefit as Nissan has done. Then, if they decide to eliminate this credit, do it slowly and phase it out over the next decade. Georgia has a great business climate, in part because we don’t make knee-jerk regulations causing uncertainty and confusion in the marketplace. Let’s not change that now.

Seriously, read the article, because it’s a great summary of the issues.

You don’t have a lot of time, and you just want to fire off an automated email to legislators about this? Use this form at bit.ly/GaEVTax to voice your support for EV-friendly state policies. It’ll use your ZIP code to figure out who to send it to, and put your name on it. A phone call can make more impact, but if you don’t even have the time to do that, at least fire off one of these automated emails.

Finally, use this link to look up who your state legislators are (you have two) and pick up the phone and CALL THEM to let them know your position on EV-friendly policies! Also consider contacting the relevant committee members and legislative leadership.

Take the time to talk to your friends and co-workers about this. There’s a lot of misinformation out there, and if you are an EV owner, YOU are uniquely qualified to correct and educate.