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Instructions for Form 8936

Department of the Treasury
Internal Revenue Service

(Rev. January 2023)

Qualified Plug-in Electric Drive Motor Vehicle Credit (Including Qualified
Two-Wheeled Plug-in Electric Vehicles and New Clean Vehicles)
Section references are to the Internal Revenue Code unless
otherwise noted.

Future Developments

For the latest information about developments related to
Form 8936 and its instructions, such as legislation enacted
after they were published, go to IRS.gov/Form8936.

What’s New
Credit for two-wheeled vehicles. The credit for qualified
two-wheeled plug-in electric vehicles expired for vehicles
acquired after 2021. However, if you acquired the
two-wheeled vehicle in 2021, but placed it in service during
2022, you may still be able to claim the credit for 2022. Do
not report two-wheeled vehicles acquired after 2021 on Form
8936.
The credit is for qualified plug-in electric drive motor
vehicles placed in service before 2023, qualified
two-wheeled plug-in electric vehicles acquired before but
placed in service in 2022, and new clean vehicles placed in
service after 2022.
Phaseout for Toyota vehicles. For more information, see
the instructions for Line 4b
Toyota, Tesla, and GM vehicles sold after 2022 will no
longer be subject to a credit phaseout.

General Instructions
Purpose of Form

Use Form 8936 to figure your credit for qualified plug-in
electric drive motor vehicles and new clean vehicles you
placed in service during your tax year. Also use Form 8936 to
figure your credit for certain qualified two-wheeled plug-in
electric vehicles discussed under What's New, earlier.
The credit attributable to depreciable property (vehicles
used for business or investment purposes) is treated as a
general business credit. Any credit not attributable to
depreciable property is treated as a personal credit.
Partnerships and S corporations must file this form to
claim the credit. All other taxpayers are not required to
complete or file this form if their only source for this credit is a
partnership or S corporation. Instead, they can report this
credit directly on line 1y in Part III of Form 3800, General
Business Credit.

Which Revision To Use

Use these January 2023 instructions with the January 2022
revision of Form 8936 for tax years beginning in 2022 or later,
until a later revision is issued. Use prior revisions of these
instructions for earlier tax years. All revisions are available at
IRS.gov/Form8936.

Sep 22, 2022

Qualified Plug-in Electric Drive Motor
Vehicle

This is a new vehicle with at least four wheels that was
placed in service before January 1, 2023.
• Is propelled to a significant extent by an electric motor that
draws electricity from a battery that has a capacity of not less
than 4 kilowatt hours and is capable of being recharged from
an external source of electricity, and
• Has a gross vehicle weight of less than 14,000 pounds.

Credit requirements. The following requirements must be
met to qualify for the credit:
• You are the owner of the vehicle. If the vehicle is leased,
only the lessor and not the lessee, is entitled to the credit.
• You placed the vehicle in service during your tax year.
• The vehicle is manufactured primarily for use on public
streets, roads, and highways.
• The original use of the vehicle began with you.
• You acquired the vehicle for use or to lease to others, and
not for resale.
• You use the vehicle primarily in the United States.

Qualified Two-Wheeled Plug-in
Electric Vehicle

This is a new vehicle with two wheels that was acquired
before 2022 and placed in service in 2022.
• Is capable of achieving a speed of 45 miles per hour or
greater,
• Is propelled to a significant extent by an electric motor that
draws electricity from a battery that has a capacity of not less
than 2.5 kilowatt hours and is capable of being recharged
from an external source of electricity, and
• Has a gross vehicle weight of less than 14,000 pounds.
Credit requirements. The following requirements must be
met to qualify for the credit:
• You are the owner of the vehicle. If the vehicle is leased,
only the lessor and not the lessee, is entitled to the credit.
• You placed the vehicle in service during your tax year.
• The vehicle is manufactured primarily for use on public
streets, roads, and highways.
• The original use of the vehicle began with you.
• You acquired the vehicle for use or to lease to others, and
not for resale.
• You use the vehicle primarily in the United States.

Clean Vehicle

This is a new vehicle with at least four wheels that was
placed in service after December 31, 2022.
• Is propelled to a significant extent by an electric motor that
draws electricity from a battery that has a capacity of not less
than 7 kilowatt hours and is capable of being recharged from
an external source of electricity, and
• Has a gross vehicle weight of less than 14,000 pounds
and made by a qualified manufacturer.

Cat. No. 67912V

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Then the phaseout allows 50% of the full credit for 2 quarters,
25% of the full credit for 2 additional quarters, and no credit
thereafter.

Credit requirements. The following requirements must be
met to qualify for the credit:
• You are the owner of the vehicle. If the vehicle is leased,
only the lessor and not the lessee, is entitled to the credit.
• You placed the vehicle in service during your tax year.
• The vehicle is made by a qualified manufacturer and
manufactured primarily for use on public streets, roads, and
highways.
• The original use of the vehicle began with you.
• You acquired the vehicle for use or to lease to others, and
not for resale.
• You use the vehicle primarily in the United States.

Basis Reduction

Unless you elect not to claim the credit, you may have to
reduce the basis of each vehicle by the sum of the amounts
entered on lines 11 and 18 for that vehicle.

Coordination With Other Credits

A vehicle that qualifies for the qualified plug-in electric drive
motor vehicle credit on this form cannot be used to claim the
alternative motor vehicle credit on Form 8910.

Certification and Other Requirements

Recapture of Credit

Generally, you can rely on the manufacturer’s (or, in the case
of a foreign manufacturer, its domestic distributor’s)
certification to the IRS that a specific make, model, and
model year vehicle qualifies for the credit and, if applicable,
the amount of the credit for which it qualifies. The
manufacturer or domestic distributor should be able to
provide you with a copy of the IRS letter acknowledging the
certification of the vehicle.

If the vehicle no longer qualifies for the credit, you may have
to recapture part or all of the credit. For details, see section
30D(f)(5).

Specific Instructions
Line 2

If, however, the IRS publishes an announcement that the
certification for any specific make, model, and model year
vehicle has been withdrawn, you cannot rely on the
certification for such a vehicle acquired after the date of
publication of the withdrawal announcement.

Enter the vehicle's vehicle identification number (VIN) on
line 2. The VIN of a vehicle can be obtained from the
registration, title, proof of insurance, or actual vehicle.
Generally, the VIN is 17 characters made up of numbers and
letters.

If you acquired a vehicle and its certification was
withdrawn on or after the date you acquired it, you can rely
on such certification even if you had not placed the vehicle in
service or claimed the credit by the date the withdrawal
announcement was published by the IRS. The IRS will not
attempt to collect any understatement of tax liability
attributable to reliance on the certification as long as you
acquired the vehicle on or before the date the IRS published
the withdrawal announcement.

Line 4a

For two-wheeled vehicles, enter the cost of the vehicle you
entered on line 1. For vehicles with at least four wheels, enter
the credit allowable for the year, make, and model of vehicle
you entered on line 1. You can generally rely on the
manufacturer’s (or domestic distributor’s) certification to the
IRS of the credit allowable as explained above.
Tentative credit amounts acknowledged by the IRS are
available at IRS.gov/pluginvehiclecreditamounts.

Exception. If you are the seller of a qualified plug-in electric
drive motor vehicle or qualified two-wheeled plug-in electric
vehicle to a tax-exempt organization, governmental unit, or a
foreign person or entity, and the use of that vehicle is
described in section 50(b)(3) or (4), you can claim the credit,
but only if you clearly disclose in writing to the purchaser the
amount of the tentative credit allowable for the vehicle (from
line 11 of Form 8936). Treat all vehicles eligible for this
exception as business/investment property. If you elect to
claim the credit, you must reduce cost of goods sold by the
amount you entered on line 11 for that vehicle.

!

CAUTION

For any vehicles subject to a reduced credit
(discussed next), enter the original unreduced credit
amount on line 4a.

Line 4b

Enter 100% unless the vehicle was a vehicle with at least four
wheels manufactured by Toyota,Tesla or General Motors
(Chevrolet Bolt EV, etc.).

Toyota. Enter the following percentage if the vehicle was
manufactured by Toyota:
• 100% if you purchased it before October 1, 2022.
• 50% if you purchased it after September 30, 2022, but
before January 1, 2023.
• 100% if you purchased it after December 31, 2022.

More information. For details, see the following.
• Section 30D.
• P.L. 117–169, sec. 13401.
• Notice 2009-89, 2009-48 I.R.B. 714, available at
IRS.gov/irb/2009-48_IRB#NOT-2009-89.
• Notice 2013-67, 2013-45 I.R.B. 470, available at
IRS.gov/irb/2013-45_IRB#NOT-2013-67.
• Notice 2016-51, 2016-37 I.R.B. 344, available at
IRS.gov/irb/2016-37_IRB#NOT-2016-51.

Tesla. Enter 100% if the vehicle was acquired after
December 31, 2022. The credit was not available for Tesla
vehicles acquired after December 31, 2019, and before
January 1, 2023. For more information, see Notice 2018-96,
2018-52 I.R.B.1061, available at IRS.gov/irb/
2018-52_IRB#NOT-2018-96.

Credit Phaseout

The credit for vehicles with at least four wheels is subject to a
phaseout (reduction) once the vehicle manufacturer (or, for a
foreign manufacturer, its U.S. distributor) sells 200,000 of
these vehicles to a retailer for use in the United States after
2009. The phaseout begins in the second calendar quarter
after the quarter in which the 200,000th vehicle was sold.

General Motors. Enter 100% if the vehicle was acquired
after December 31, 2022. The credit was not available for
General Motors vehicles acquired after March 31, 2020, and
before January 1, 2023. For more information, see Notice
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Instructions for Form 8936 (Rev. 1-2022)

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2019-22, 2019-14 I.R.B. 931, available at IRS.gov/irb/
2019-14_IRB#NOT-2019-22.

result by 12. For example, if you converted a vehicle to 50%
business use for the last 6 months of the year, you would
enter 25% on line 5 (50% multiplied by 6 divided by 12).

Line 5

For more information, see Pub. 463, Travel, Gift, and Car
Expenses.

Enter the percentage of business/investment use.
Enter 100% if the vehicle is used solely for business
purposes or you are claiming the credit as the seller of the
vehicle.

Line 7

Enter any section 179 expense deduction you claimed for the
vehicle from Part I of Form 4562, Depreciation and
Amortization.

If the vehicle is used for both business purposes and
personal purposes, determine the percentage of business
use by dividing the number of miles the vehicle is driven
during the year for business purposes or for the production of
income (not to include any commuting mileage) by the total
number of miles the vehicle is driven for all purposes. Treat
vehicles used by your employees as being used 100% for
business/investment purposes if the value of personal use is
included in the employees’ gross income, or the employees
reimburse you for the personal use. If you report the amount
of personal use of the vehicle in your employee’s gross
income and withhold the appropriate taxes, enter “100%” for
the percentage of business/investment use.

Line 13

Enter total qualified plug-in electric drive motor vehicle
credits from:

• Schedule K-1 (Form 1065), Partner's Share of Income,
Deductions, Credits, etc., box 15 (code P); and
• Schedule K-1 (Form 1120-S), Shareholder's Share of
Income, Deductions, Credits, etc., box 13 (code P).
Partnerships and S corporations report the above credits on
line 13. All other filers figuring a separate credit on earlier
lines also report the above credits on line 13. All others not
using earlier lines to figure a separate credit can report the
above credits directly on Form 3800, Part III, line 1y.

If during the tax year you convert property used solely for
personal purposes to business/investment use (or vice
versa), figure the percentage of business/investment use
only for the number of months you use the property in your
business or for the production of income. Multiply that
percentage by the number of months you use the property in
your business or for the production of income and divide the

Line 18

Use the following worksheet to figure the amount to enter on
line 18 for a vehicle placed in service after 2022.

Modified Adjusted Gross Income (MAGI) Income Limitation

Keep for Your Records

MAGI Limitation Worksheet
1. Enter $150,000 ($300,000 if married filing jointly or a qualifying surviving
spouse; $225,000 if head of household) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
2. a.Enter the amount from line 11 of your current year Form 1040, 1040-SR, or
1040-NR . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2a.
b. Enter any income from Puerto Rico you excluded . . . . . . . . . . . . . . . . . . . . . . . . 2b.
c. Enter any amount from Form 2555, line 45 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2c.

1.

d. Enter any amount from Form 2555, line 50 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2d.
e. Enter any amount from Form 4563, line 15 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2e.

3. Add lines 2a through 2e . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

4. a. Enter the amount from line 11 of your prior year Form 1040, 1040-SR, or
1040-NR . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4a.
b. Enter any income from Puerto Rico you excluded . . . . . . . . . . . . . . . . . . . . . . . . 4b.
c. Enter any amount from Form 2555, line 45 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4c.
d. Enter any amount from Form 2555, line 50 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4d.
e. Enter any amount from Form 4563, line 15 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4e.

3.

5. Add lines 4a through 4e . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

5.

6. Enter the smaller of line 3 or line 5 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

6.

7. Subtract line 6 from line 1 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

7.

If line 7 is:
• Less than zero, enter 0- on line 18.
• Zero or more, enter the amount from line 15 on line 18.

Instructions for Form 8936 (Rev. 1-2022)

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Line 21

tax returns and return information are confidential, as
required by section 6103.

Enter the total, if any, credits from Schedule 3 (Form 1040),
lines 1 through 4, 6d, 6e, and 6I; and Form 5695, line 30.

The time needed to complete and file this form will vary
depending on individual circumstances. The estimated
burden for individual and business taxpayers filing this form
is approved under OMB control number 1545-0074 and
1545-0123 and is included in the estimates shown in the
instructions for their individual and business income tax
return. The estimated burden for all other taxpayers who file
this form is shown below.

Line 23

If you cannot use part of the personal portion of the credit
because of the tax liability limit, the unused credit is lost. The
unused personal portion of the credit cannot be carried back
or forward to other tax years.

Paperwork Reduction Act Notice. We ask for the
information on this form to carry out the Internal Revenue
laws of the United States. You are required to give us the
information. We need it to ensure that you are complying with
these laws and to allow us to figure and collect the right
amount of tax.
You are not required to provide the information requested
on a form that is subject to the Paperwork Reduction Act
unless the form displays a valid OMB control number. Books
or records relating to a form or its instructions must be
retained as long as their contents may become material in
the administration of any Internal Revenue law. Generally,

Recordkeeping . . . . . . . . . . . . . . . . . . .
Learning about the law or the form . . . . . . .
Preparing and sending the form to the IRS . .

4 hr., 4 min.
35 min.
41 min.

If you have comments concerning the accuracy of these
time estimates or suggestions for making this form simpler,
we would be happy to hear from you. See the instructions for
the tax return with which this form is filed.

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Instructions for Form 8936 (Rev. 1-2022)