What the federal electric bike tax credit is

The federal government offers a tax credit of up to $900 for buying a new electric bicycle. Unlike a rebate you get at the store, this credit reduces the federal income tax you owe when you file your return — or increases your refund if you don't owe taxes. You claim it on Form 8936 when you file with the IRS.

The credit covers most electric bikes sold in the United States, as long as they cost less than $4,000 and meet specific requirements about motor power and assembly location. The credit is available to individuals and married couples filing jointly, and there is no income limit to claim it.

This credit became available for tax year 2023 and applies to bikes purchased on or after January 1, 2023. The rules are relatively new, so many people buying e-bikes do not yet know the credit exists.

Key Takeaways

  • The federal credit covers up to $900 per electric bike, claimed when you file your tax return, not at the point of purchase.
  • Your e-bike must cost less than $4,000, have a motor of 750 watts or less, and be assembled in North America to may have access to.
  • You claim the credit on Form 8936, which you file with your regular tax return to the IRS.
  • Some states and cities offer their own e-bike rebates that may stack with the federal credit, so check your local programs.
  • The credit applies to bikes purchased starting January 1, 2023, and you have until the tax filing important date to claim it for that year's purchase.

Which electric bikes may have access to

Your e-bike must meet three main requirements. First, the motor cannot exceed 750 watts of power — this is the federal definition of an electric bicycle rather than a motorized vehicle. Second, the bike must have pedals that work independently of the motor, so you can ride it without electric power. Third, the bike must be assembled in the United States, Canada, or Mexico.

The bike's price tag must be under $4,000 at the time you buy it. If you buy a $3,500 e-bike, you can claim the full $900 credit. If you buy a $2,000 e-bike, you still claim the full $900 credit — the credit does not scale down based on what you paid. The credit is capped at $900 per bike, not at the purchase price.

Most major e-bike brands sold in the United States meet these requirements. Cargo bikes, folding e-bikes, and mountain e-bikes all count as long as they have pedals and a motor under 750 watts. If you are unsure whether a specific bike qualifies, check the manufacturer's specifications for motor wattage and assembly location before you buy.

How to claim the credit on your tax return

You claim the credit using Form 8936, titled "may have access to Electric Vehicle Credit." You fill out this form and attach it to your federal tax return when you file. The form asks for the date you bought the bike, the cost, and the vehicle identification number (VIN) if the bike has one — many e-bikes do, but not all.

You will need to keep your receipt or invoice from the purchase. The receipt should show the purchase date, the bike model, and the price you paid. If the bike was assembled outside North America, the receipt or product information should make that clear, which would disqualify it.

File the form with your tax return by the important date for that tax year. If you bought the bike in 2023, you claim it on your 2023 return, due April 15, 2024 (or later if you request an extension). If you bought it in 2024, you claim it on your 2024 return, due April 15, 2025.

Income limits and who can claim the credit

There is no income limit to claim the federal e-bike credit. Unlike some other tax credits that phase out at higher incomes, this one is available to anyone who buys a may have access to bike and files a federal tax return.

You must be a U.S. citizen or resident alien to claim it. If you are married and file jointly, you can each claim the credit for one bike per year — so a married couple could claim up to $1,800 total if you each buy a may have access to e-bike in the same year. If you file as single, head of household, or married filing separately, you can claim the credit for one bike per year.

You cannot claim the credit if someone else already claimed it for that same bike. For example, if your spouse bought the bike and claimed the credit, you cannot also claim it. The credit applies once per bike, not once per person.

State and local e-bike rebates that may stack with the federal credit

Many states and cities offer their own e-bike rebates or discounts on top of the federal credit. These programs vary widely by location. Some offer a percentage off the purchase price at the time you buy; others offer a rebate you claim later, similar to the federal credit.

California, Colorado, New York, and Washington state all have e-bike rebate programs, though the amounts and income limits differ. Some cities, including Denver, San Francisco, and Portland, run their own programs. A few states limit rebates to lower-income buyers, while others have no income restriction.

The federal credit and a state or local rebate can usually be stacked — you get both. However, some state programs reduce their rebate if you receive a federal credit, so check the rules for your location before you buy. Contact your city or county government, or search "[your state] e-bike rebate" to find out what is available where you live.

What happens if you sell the bike later

Once you claim the federal credit and receive it, you own the benefit. If you sell the e-bike a year later, you do not have to return the credit or pay it back. The credit is yours to keep.

However, you can only claim the credit once per bike. If you buy a second e-bike in a later year, you can claim the credit for that bike as well — up to one bike per year per person. But you cannot claim the credit twice for the same bike.

Frequently Asked Questions

Can I claim the credit if I bought my e-bike before 2023?

No. The credit only covers bikes purchased on or after January 1, 2023. If you bought an e-bike in 2022 or earlier, you cannot claim this credit. However, check whether your state or city offers a separate e-bike rebate program that may cover older purchases.

Do I have to buy the bike myself, or can someone give me one as a gift?

You must be the person who bought the bike to claim the credit. If someone gives you an e-bike as a gift, you cannot claim the credit because you did not purchase it. The person who bought it could have claimed the credit on their own return.

What if my e-bike has a motor larger than 750 watts?

It does not may have access to for the federal credit. The 750-watt limit is a federal requirement that defines an electric bicycle. Bikes with larger motors are classified as motorized vehicles and are not may be able to access. Check the manufacturer's specifications before you buy if you are unsure.

Can I claim the credit if I bought the bike with a credit card or loan?

Yes. How you paid for the bike does not affect your ability to claim the credit. Whether you paid cash, used a credit card, took out a personal loan, or financed through the bike shop, you can still claim the $900 credit on your tax return.

What if I cannot find the receipt for my e-bike purchase?

You will need some proof of purchase to claim the credit. If you lost the receipt, try contacting the bike shop where you bought it — they may have a record of the sale. You could also check your credit card or bank statement for the transaction. The IRS may ask for documentation if you are audited, so having some record is important.