IRS Announces Commercial Clean Vehicle Credit Incremental Cost

Treasury, IRS issue guidance on the incremental cost for the Commercial Clean Vehicle Credit

Dec. 29, 2022

WASHINGTON — The Treasury Department and Internal Revenue Service today issued Notice 2023-9 regarding the commercial clean vehicle credit for commercial vehicles purchased and placed in service, during the taxable year.

The guidance informs taxpayers that the Department of the Treasury and the Internal Revenue Service have reviewed the incremental cost for all street vehicles in calendar year 2023. The analysis shows that the incremental cost of all street vehicles (other than in the case of compact car PHEVs) that have a gross vehicle weight rating of less than 14,000 pounds will be greater than $7,500 in calendar year 2023.

Accordingly, the incremental cost will not limit the available credit amount for street vehicles that have a gross vehicle weight rating of less than 14,000 pounds and are placed in service in calendar year 2023.

For compact car plug-in electric hybrids for which the incremental cost was calculated to be less than $7,500, the Treasury Department and the IRS will accept for vehicles placed in service during calendar year 2023 a taxpayer’s use, in calculating the credit amount, of the incremental cost published by the Department of Energy.