EV Charging Tax Credits in 2020 for Installing New Charging Infrastructure

By February 10, 2020 Blog
An electric car sits charging at an EV charger in a parking lot.

An electric car sits charging at an EV charger in a parking lot.

With more electric vehicles on the road than ever before, and strong projections of growth in the EV market throughout the 2020s due to continuing public pressure to move toward greener technologies, 2020 is a great year to install new EV charging infrastructure in your parking lots.

Today in the EV Connect Blog, we’re looking at EV charger tax credits available in 2020. These incentives can go a long way toward making the numbers work on your infrastructure project!

The Alternative Fuel Infrastructure Tax Credit

This is the grand titan of all the various EV charging tax credits out there. The Alternative Fuel Infrastructure Tax Credit (AFITC) is a federal tax credit with a value of 30 percent of the cost of purchasing and installing EV charging hardware, excluding the costs of permitting and inspections. The AFITC goes up to a maximum dollar value of $30,000.

This includes the price of the physical EV charging units themselves, shipping and delivery, and construction work on the parking lot. The AFITC even covers the purchase of EV charging management solutions, such as:

Who Benefits from the AFITC EV Charger Tax Credit?

This EV charging tax credit is an amazing opportunity for multiple types of scenarios, including:

  • Enterprises such as hotels, retail, and apartment buildings who want to raise the value proposition of their product offerings by catering to the more affluent EV driver demographic.
  • Corporate and public fleet operators looking to upgrade their fleets to electric to save on vehicle operating costs and maintenance, while burnishing their green-thinking public image.
  • Transit agencies who want to upgrade to electric but are stifled by budget constraints.
  • Parking lot operators looking to develop supplementary ROI streams for their existing parking lots.

The AFITC can single-handedly make an EV infrastructure project financially viable for your organization. Think about it: This amazing EV charging tax credit basically says that you get one-third off the cost of growing your business and operations!

The AFITC Is Expiring at the End of 2020

The AFITC is a time-limited EV charging tax credit. It already expired once, in 2016, but was extended by the government through December 31, 2020. As it currently stands, the credit will apply to any EV charging installation work through December 31. A further extension is not guaranteed, so you would need to act this year to take advantage of this EV charging tax credit.

Good for Residential & Business Infrastructure Projects

Business owners with multiple parking lots may install charges at multiple locations under the AFITC rules. Private citizens who install residential charging equipment are also eligible for a tax credit of up to $1,000.

Additional AFITC Benefits

The AFITC isn’t just an EV charging tax credit. Like its name suggests, it also offers a credit for various other alternative fuel infrastructure projects, including:

  • Natural gas
  • Propane
  • Liquefied hydrogen
  • E85
  • Diesel fuel blends containing a minimum of 20% biodiesel

If you have more than one type of alternative fuel infrastructure project on your radar, the AFITC offers incredible versatility and is therefore a great way to consolidate projects and get a larger credit.

State & Local EV Charging Tax Credits

While the AFITC at the federal level is the most prominent of these incentives, there are numerous state and local EV charger tax credits and other incentives. We can’t list them all here, so be sure to visit our Tax Incentives page to see what credits and other benefits are available in your area.

LADWP Commercial EV Charging Station Rebate Program

Los Angeles is the leading hotbed of electric vehicle market penetration in the United States. With their city’s vast sprawling distances, heavy traffic, and tech-minded love of innovation, Angelenos are some of the most fervent adopters of EVs.

The Los Angeles Department of Water & Power runs a highly successful commercial EV charging station rebate program to offset the cost of installation on new EV infrastructure. This is essentially the same thing as an EV charging tax credit, except you’re getting back money from the power company instead of the government.

  • Up to $5,000 for Level 2 commercial charging stations. This rebate is so popular that it is currently waitlisted, so the sooner you apply for it the better.
  • Up to $75,000 for direct current fast charger (DCFC) stations (sometimes known as Level 3 chargers), depending on total power output, to charge regular electric vehicles.
  • Up to $125,000 for DCFC charging stations that serve medium and heavy-duty EVs.

There is also a rebate of up to $500 available for installing residential EV charging infrastructure at home.

Let EV Connect Help You Obtain EV Charger Tax Credits

Charging infrastructure is expensive, but with these EV charging tax credits and other incentives, you can recoup a major portion of your investment. And with electric vehicles rapidly gaining market share, we’re currently in the midst of a serious shortage of EV charging infrastructure. The people who get ahead of this demand and build out new charging infrastructure now will be the ones best positioned to take advantage of sustained EV market growth that is expected to continue throughout the 2020s. This is a lucrative market: EV drivers tend to be more affluent than the average motorist, so they often make for good customers, tenants, employees, and clients. As the saying goes, “build it and they will come.”

At EV Connect, we have the knowledge base and experience to help you identify EV charging tax credits and other rebates and incentives available in your area. We’re also happy to help you apply for them, so that you can be confident your paperwork is correct and complete.

Contact us today to learn more about the incentives available to you, or to learn more about our comprehensive suite of EV charger networking solutions!

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