Are you are thinking of buying a Hyundai EV in 2025 ? So here’s some good news for you–the federal government is still offering hyundai ev tax credit in usa 2025 for certain electric vehicles. But before you get too excited, not every Hyundai model qualifies—and the rules can get a little tricky.
So, come let’s break it down. By the end of this guide, you’ll come to know exactly which Hyundai EVs are eligible for tax credits, how much you could save, what state incentives are available, and whether it’s smarter to buy now or wait until later in the year.
What Is the Federal EV Tax Credit?
The federal EV tax credit is basically a financial incentive from the U.S. government. It aims to encourage people to switch from gas cars to electric vehicles. Depending on the model, you can get up to $7,500 back in tax credits when you purchase a new EV.
Think of it as bonus for choosing electric vehicles .But it’s not as simple as to buy an EV, and get $7,500.The actual amount depends on following:
- Where the car is assembled.
- Where the battery materials come from.
- Whether the vehicle meets the latest Inflation Reduction Act (IRA) requirements.
Do Hyundai EVs Qualify for the 2025 EV Tax Credit?
Here is where things can get a little frustrating for Hyundai fans in 2025. Most Hyundai EVs sold in the U.S. are manufactured in South Korea, not in North America. Under the new rules, only EVs assembled in North America can qualify for the federal tax credit.
That means, as of early 2025, Hyundai’s most popular EVs do not qualify for the federal credit.
So these are Currently Not Eligible
- Hyundai Ioniq 5
- Hyundai Ioniq 6
- Hyundai Kona Electric
These are excellent EVs with its great design, strong range, and competitive pricing.But because as they’re not built in the U.S. (yet), they don’t meet federal requirements.
The Hyundai EV Factory in Georgia – A Game Changer
Here’s where things get exciting: Hyundai is building a massive $7.6 billion EV and battery plant in Georgia, scheduled to open by late 2025.
Once production shifts to the U.S., models like the Ioniq 5 and Ioniq 6 will finally qualify for the full $7,500 federal tax credit. That’s a big deal because it instantly makes them more competitive against Tesla, Ford, and GM.
So,If you’re not in a hurry, you can wait until late 2025 which could save you thousands.
State Rebates and Incentives – Don’t Overlook These
Even though Hyundai EVs don’t currently qualify for federal credits, you can still save money through different state-level programs. Many states and even utility companies offer rebates, tax credits, or reduced charging rates.Here are some examples:
- California: In california you can get up to $2,000 rebate for qualifying EVs. Plus, EVs may qualify for carpool lane access.
- Colorado: In Colorado,$5,000 state tax credit (one of the most generous in the U.S.).
- New Jersey: Get Up to $4,000 rebate + no sales tax on EVs.
- New York: Get Up to $2,000 rebate under the Drive Clean program.
- Oregon: $2,500 rebate + potential “Charge Ahead” incentives for low- and moderate-income households.
- Texas: Up to $2,500 rebate for battery electric vehicles.
Remember to Check your local utility company too. Many offer additional rebates on home chargers or special low-cost EV charging plans.
Buying vs Leasing a Hyundai EV in 2025
Here’s a clever workaround: while Hyundai EVs don’t qualify for federal tax credits if you buy them outright, leasing is a different story.
Why? Because the tax credit goes to the leasing company, not the buyer. But many leasing companies pass those savings back to you as lower monthly payments.
A Hyundai Ioniq 5 lease may come with a built-in discount because the leasing company claims the $7,500 federal credit.
So, if you want a Hyundai EV now, leasing could be the smarter financial move in 2025.
Hyundai EVs vs Competitors (Tax Credit Advantage)
It’s impossible to ignore the competition here. Let’s compare:
Tesla Model Y –This model Qualifies for the $7,500 credit (U.S.-built).
Ford Mustang Mach-E – Certain trims qualify for the federal credit.
Chevy Blazer EV & Equinox EV – It is Eligible for the tax credit.
Hyundai Ioniq 5 / 6 – No federal credit yet (until Georgia plant opens).
This puts Hyundai at a disadvantage in 2025, but once U.S. production starts, their EVs will instantly become more attractive.
How to Claim an EV Tax Credit
If you buy an EV that qualifies, then here’s the process:
First Check eligibility by Visiting fueleconomy.gov for the latest list.
Second,Get the paperwork ready from the dealer.This includes the VIN and confirmation that the car qualifies.
File IRS Form 8936 . This is where you officially claim the credit when you do your taxes.
Combine with state incentives – You can often “stack” state rebates with the federal credit.
Reminder for you: The federal EV tax credit is non-refundable, meaning it only reduces the taxes you owe. If your tax liability is less than $7,500, you won’t get the full amount back.
FAQs (Frequently asked questions)About Hyundai EV Tax Credit in 2025
Can I get the EV tax credit if I buy a Hyundai Ioniq 5 in 2025?
Not yet. Since it’s made in South Korea, it doesn’t qualify for the federal credit. You may still qualify for state incentives.
Will Hyundai EVs qualify in the future?
Yes. Once the new Georgia plant opens in late 2025, Hyundai EVs should meet the requirements.
What about used Hyundai EVs?
The Inflation Reduction Act also created a used EV tax credit (up to $4,000), but currently, most used Hyundai EVs don’t qualify because of the foreign assembly rules.
Is leasing a Hyundai EV worth it?
For many buyers in 2025, yes. Leasing allows the company to claim the $7,500 federal credit and pass the savings to you.
Should I wait or buy now?
If you can wait until late 2025, you’ll likely save more. If you need a car now, check your state incentives and consider leasing.
My final Thoughts
Hyundai makes some of the most stylish and affordable EVs on the market, but the federal tax credit situation in 2025 isn’t ideal for U.S. buyers.
But Remember,State rebates and incentives can still knock thousands off your purchase.Leasing offers a clever way to indirectly benefit from the federal credit.
And once Hyundai’s Georgia factory opens, the Ioniq 5, Ioniq 6, and Kona Electric should finally qualify for the full $7,500 federal credit.
Do you want to know how electric vehicles are shaping the future of u.s Roads in 2025?