Credits can be signed over to dealerships, so consumers can save $5,000 when buying instead of waiting for tax season.
By: Brandon Turkus
Coloradoans, you might want to take another look at an electric car. The state has officially passed a bill – HB 1332 – that modifies the state tax credits associated with "alternative fuel motor vehicles" to bring the state credit to parity with the EV paradise that is California.
The old system called on some obscure formula for determining the size of a tax credit when purchasing an EV, but the new system replaces that with a simple flat tax for a "light-duty" EV. Eligible buyers can snag a $5,000 incentive, which can be paired with the $7,500 federal tax credit, slashing $12,500 off a consumer's taxes. That'd mean a very big refund come April for anyone who qualifies.
So yes, Colorado is like California. But in an important way, it's better. According to the Southwest Energy Efficiency Project, Colorado's state tax credit can be assigned to a dealership or finance company. Consumers sign over the tax credit to the proper party at the time of purchase, effectively surrendering it in exchange for the dealer slashing $5,000 off the purchase price. In other words, the tax credit becomes an incentive and is available when you buy the car.
According to SWEEP, the new law is the "best EV tax incentive in the nation" and should lead to a big increase EV sales in the Centennial State. We suspect this will be the case, because who doesn't like a $5,000 discount?