Colorado’s Electric Vehicle Tax Credits
Colorado is leading the charge on vehicle electrification.
Funding Overview:
Eligibility: Residents, Business & Industry
Types of Funding: State Tax Credits
Tax credits are available in Colorado for the purchase or lease of electric vehicles (EVs) and plug-in hybrid electric vehicles (PHEVs). Coloradans can save money on the upfront cost of purchasing an EV and on fuel and maintenance costs over the course of the vehicle’s lifespan.
Note: The Colorado Energy Office does not offer tax advice. For questions about the state EV tax credit, please reach out to the Colorado Department of Revenue.
For questions about the federal EV tax credit, please visit the U.S. Internal Revenue Service’s website.
Information for Residents & Businesses:
Colorado provides zero-emission vehicle tax credits for the purchase or lease of new electric vehicles. Tax incentives are available for both personal and commercial electric vehicles. This includes both battery electric and plug-in hybrid electric vehicles. A motor vehicle, truck, or trailer must be titled and registered in Colorado to qualify for the credit.
See list of full electric and plug-in hybrid electric vehicles
Colorado taxpayers are eligible for a state tax credit of $3,500 for the purchase or lease of a new EV with a manufacturer’s suggested retail price (MSRP) up to $80,000, and an additional tax credit of $2,500 for the purchase or lease of a new EV with an MSRP up to $35,000. Lease agreements must have an initial term of at least two years.
Some EV dealers allow Coloradans to assign the tax credit to the dealer in order to receive the tax credit amount as a point-of-sale discount off the purchase price of the vehicle. We recommend reaching out to your local EV dealer to find out if they offer this option.
Learn more about the state EV tax credit
Tax credits are also available for light-, medium-, and heavy-duty electric (including hydrogen) trucks. Learn more in the Innovative Truck Credit overview document.
Additional Resources
If you are just learning about EVs, you are not alone! Learn more about available incentives, the benefits of driving an EV, charging, and more on the EV CO website.
Go to EV CO Website
Additional EV incentives for businesses and residents include:
- Federal commercial tax credits – Learn more on the Internal Revenue Service (IRS) website.
- Vehicle Exchange Colorado (VXC) – A statewide rebate program for income-qualified Coloradans to replace old or high-emitting vehicles with electric vehicles.
Vehicle Exchange Colorado - Utility Rebates – Some utility providers offer rebates to consumers to offset the cost of purchasing an EV or the cost to install EV chargers at homes or at businesses. Reach out to your utility provider to learn more.
- Fleet Zero-Emission Resource Opportunity (Fleet-ZERO) – Provides funding for EV charging to support the transition of light-, medium-, and heavy-duty fleets to EVs.
Fleet Zero-Emission Resource Opportunity - CDPHE's Clean Fleet Vehicle and Technology Grant Program – A statewide competitive application process for new fleet vehicles, vehicle conversions, and clean fleet technology.
Clean Fleet Vehicle and Technology Grant Program
Find more EV incentives for consumers interested in purchasing or leasing an electric vehicle or installing a charger
View Drive Electric Colorado Website
