(Post-September 2025 Update for U.S. and Colorado Drivers)
The electric vehicle (EV) landscape in the U.S. has changed dramatically over the past few months. As of September 30, 2025, the federal EV tax credit program officially expired, ending a decade-long incentive that helped millions of Americans make the switch to electric.
But all is not lost — many state and local incentives, including those in Colorado, are still available to help soften the price of going electric. Here’s where things stand now.
The Federal EV Tax Credit Has Ended
For years, the Clean Vehicle Credit (under Section 30D of the IRS code) provided up to $7,500 toward the purchase of new electric or plug-in hybrid vehicles that met specific assembly, battery, and pricing requirements.
However, under the phase-out provisions passed earlier this year, the program officially ended for vehicles acquired after September 30, 2025. Only buyers who entered into a binding purchase contract with a deposit before that date are eligible to still claim the credit on their 2025 tax return.
Here’s what that means:
- No new federal tax credits are available for EVs purchased on or after October 1, 2025.
- The used clean vehicle credit (worth up to $4,000) has also expired.
- The home EV charger credit remains available through June 30, 2026, providing up to 30% of installation costs (up to $1,000) for home charging equipment.
Some automakers may still offer lease-based incentives that mimic federal credits, since in certain cases the manufacturer (as the lessor) can claim the credit and pass the savings on through reduced lease payments.
Colorado Steps Up: State EV Incentives in 2025–2026
Colorado has long been one of the most EV-friendly states in the country — and that continues even as federal incentives fade.
Current Colorado EV Tax Credits (as of Fall 2025)
- $3,500 state income tax credit for new electric vehicles purchased or leased in 2025.
- An additional $2,500 bonus credit for vehicles with an MSRP under $35,000.
- The credit can be assigned to your dealer or finance company at the time of sale, allowing the savings to be applied upfront as a discount instead of waiting until tax season.
- Buyers who assign the credit also qualify for a $600 “assignment bonus.”
These credits apply to new vehicles only, though Colorado has separate programs and grants for commercial EVs and fleet conversions.
What’s Changing Soon
Colorado’s state EV credit is set to decrease again in 2026:
- Expected to drop to $1,500 for most EVs.
- The bonus for lower-priced models may continue, but likely at a reduced rate.
That means 2025 represents the final high-value year for state incentives — and with federal credits gone, the Colorado credit is now one of the best in the nation.
Other Colorado EV Incentives Still in Play
In addition to the state tax credit, there are still a few other incentives worth noting:
- Property Tax Exemption: EV charging stations are exempt from property tax until January 1, 2030.
- Utility Rebates: Many electric utilities — including Xcel Energy and Platte River Power Authority — continue to offer rebates for EV chargers or time-of-use rate discounts for EV owners.
- Local Grants: Some municipalities, including Denver and Boulder, provide additional rebates or free public charging programs.
What Colorado EV Buyers Should Know Going Forward
Even without federal help, buying an EV in Colorado still comes with tangible financial benefits — but the window for maximum savings is closing fast.
Here’s how to make the most of it:
- Buy before 2026 to capture the full $3,500–$6,000 in state incentives.
- Ask your dealer about credit assignment so you can see the discount immediately on your purchase agreement.
- Check utility and local programs — some stackable rebates can add another few hundred dollars in savings.
- Keep an eye on future legislation: both state and federal policymakers are considering successor programs aimed at boosting EV adoption, especially in rural and middle-income markets.
The federal EV tax credit era has officially ended, but the shift toward electric vehicles is far from over. Colorado continues to reward EV buyers with strong incentives, especially for more affordable models.If you’ve been on the fence about going electric, late 2025 may be your last, best opportunity to take advantage of significant savings before next year’s reductions kick in.
From all of us at Quick-Set Auto Glass, drive safely out there Colorado!
Disclaimer: The information in this article is intended for general informational purposes only and reflects the most recent updates available at the time of publication. Federal and state EV tax incentives change frequently and may vary based on vehicle eligibility, purchase date, income limits, and other qualifying factors. Quick-Set Auto Glass does not provide tax or legal advice and is not responsible for any inaccuracies or changes in policy. Readers should consult the IRS, the Colorado Department of Revenue, or a licensed tax professional to confirm current credit availability and eligibility before making any purchasing decisions.
