Senate Proposes $7500 Tax Credit on Plug-In Electric Hybrid Vehicles

  • Published on January 28th, 2009

Senate stimulus plan includes $7500 tax credit for plug-in hybridsHope, day eight…

As part of the Senate’s proposed stimulus plan, tax credits of up to $7500 have been included for plug-in electric vehicles!  The proposal signifies the Senate is willing to work with President Obama to wean the United States off its dependency on foreign oil. 

The Senate proposal would double the number of cars eligible for the credit, as well as stimulate the economy through sales of plug-in electric hybrid vehicles when they hit the showrooms this fall.

>>See also: City of San Francisco Unveils Electric Car Chargers

Obama has stated there is not a “moment to spare” on the stimulus plan, and the Senate appears to be responding in kind with real change. “We’ll invest in what works,” Obama said, and I am heartened to see plug-in electric hybrids as part of this package.  Personally, I think I could afford one given a $7500 tax credit; however, that amount is reserved for vehicles weighing 10,000 pounds or less.  The size of the credit begins at $2,500 and expands with the vehicle’s battery capacity.

This new Senate proposal benefiting plug-in hybrid vehicles comes on the heals President Obama initiating the process that would force automakers to improve fuel efficiency by reducing tailpipe emissions.  Offering an increased tax credit for alternative vehicles demonstrates the Senate is on board with the new president.  The House has approved the president’s stimulus plan, with absolutely zero support from Republicans.

Image: Mike Weston on Flickr under a Creative Commons License

About the Author

Jennifer lives on 160 acres off-the-grid in a home built with her own two hands (and several more skilled pairs of hands) from forest fire salvaged timber. Her home is powered by a micro-hydro turbine, and she has been a vegetarian for 21 years. Jennifer graduated from Humboldt State University with a degree in art education and has been teaching art to children for over 16 years. She also spent five years teaching in a one-room schoolhouse before becoming the mother of two beautiful children. Jennifer has a Master's Degree in Early Childhood Education and is currently teaching preschool, as well as k-8 art. She enjoys writing, gardening, hiking, practicing yoga, and raising four akitas. Jennifer is the founder and editor of Eco Child's Play ( "I’ve always been concerned about the earth and our impact upon it. Now that I have children, I feel compelled to raise them with green values. From organic gardening to alternative energy, my family tries to leave a small carbon footprint." Please visit my other blog:


  • This and many other credits are worthless or their value greatly reduced if they are not allowed against the Alternative Minimum Tax (AMT). You would do your readers an injustice if you did not mention the AMT issue. One could buy a car which would qualify for a huge tax credit only to find out when they file their return that the credit is reduced or eliminated due to AMT. Encourage the readers to talk to your tax advisor BEFORE you buy (if this becomes law).

  • That's nice. Where do we plug these in when we are on the road? Also no one has mentioned the tax on the electricity use by the federal government to recuperate the lost revenue from fossil fuels we are weaning off of. We also will probably be required to install an additional meter at the residence with a special plug so the government can monitor the usage. How about the multi-family housing. The electricity will not be cheap…then watch, another avenue for the power companies to increase the price of kilowatt usage. The pandora's box is about to unfold. Land of the free and opportunity is about over….we are all going to be government workers at the end of this administration! Watch and learn

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