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1 1 (September 6, 2022)

handle is hein.crs/goveisj0001 and id is 1 raw text is: b&Congressional ____ ~ Research Service Inflation Reduction Act of 2022: Incentives for Clean Transportation September 6, 2022 The Inflation Reduction Act of 2022 On August 16, 2022, budget reconciliation legislation, commonly known as the Inflation Reduction Act of 2022 (IRA), was signed into law (P.L. 117-169). The IRA contains multiple provisions related to the adoption and deployment of clean transportation technologies, building upon existing programs and incentives for clean transportation. Clean Transportation Tax Incentives U.S. sales of fuel cell vehicles (FCVs) and plug-in electric vehicles (PEVs; see also Transportation Energy Data Book) have increased overall, with 2021 sales of both groups of vehicles exceeding 2019 sales. This trend in sales has occurred while car prices generally have increased, including used car prices. The prices of FCVs and PEVs are typically higher than their gasoline counterparts. Some of the various tax provisions in the IRA pertain to clean transportation. As described below, the IRA modifies the existing tax credit for new PEVs (26 U.S.C. @30D) resulting in a modified tax credit for certain clean vehicles. The IRA also creates a new tax credit for previously owned clean vehicles and commercial clean vehicles. The 200,000 per manufacturer unit phase-out threshold is eliminated, allowing qualifying new Tesla and General Motors vehicles to once again be eligible for the full tax credit. The IRA also modifies the existing tax credit for alternative fuel refueling property (26 U.S.C. @30C). All four tax credits expire on December 31, 2032. Clean Vehicle Credit Section 13401 modifies the tax credit for PEVs, expanding eligibility for clean vehicles, including FCVs (a previous tax credit for FCVs under 26 U.S.C. @30B expired December 31, 2021), and introducing income and price limits. Qualifying vehicles have final assembly in North America, and no vehicle qualifies that includes battery components (after 2023) or critical minerals (after 2024) from foreign entities of concern. Congressional Research Service https://crsreports.congress.gov IN12003 CRS INSIGHT Prepared for Members and Committees of Congress

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