Tax Credit for New Electric Bicycle Purchases (E-BIKE Act)
This Act introduces a new tax credit for individuals purchasing new electric bicycles, aiming to incentivize the use of environmentally friendly transportation. Citizens can claim a credit equal to 30% of the cost of a qualified e-bike, capped at a maximum credit of $1,500 per bicycle, directly reducing their income tax liability. The credit is limited to one bicycle every three years (two for joint filers) and phases out for high-income earners.
Key points
New Tax Credit: You can claim a credit of 30% of the cost of a new electric bicycle, with the maximum cost taken into account being $5,000 (resulting in a maximum credit of $1,500).
Limitations: The credit is limited to one bicycle per taxpayer every three years (two for joint returns) and applies only to e-bikes costing no more than $8,000.
Income Phaseout: The credit is gradually reduced if your modified adjusted gross income exceeds $150,000 (single filers), $225,000 (head of household), or $300,000 (joint filers).
Safety and Technical Requirements: Qualified e-bikes must be certified to UL 2849 safety standards (or other recognized standards) and have a motor less than 750 watts, with speed limits of 20 or 28 mph depending on the class.
Point-of-Sale Transfer: Taxpayers can elect to transfer the credit to the retailer, allowing the retailer to provide an immediate discount equal to the credit amount at the time of purchase.
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