Maryland EV Tax Credit: What’s New in 2024?

In the middle of 2023, the State of Maryland opened their own version of the EV Tax Credit. Maryland’s EV Tax Credit is available on EVs purchased for use in Maryland, and the credit can be claimed by both individual taxpayers and businesses in the state.

If you are ready to buy an electric vehicle in the state of Maryland (or if you bought one in 2023), you may be able to qualify for both the Federal EV Tax Credit and Maryland’s state-funded EV tax credit. However, while both of these credits exist to encourage EV adoption in the US, they do not have exactly the same criteria for eligibility.

Let’s walk through the details of Maryland’s EV Tax Credit, who qualifies, which vehicles are eligible, and where you can find an EV for a good price even if you don’t qualify for the credit.

Disclaimer: this article is for informational purposes only. We’re not lawyers or tax advisors; we’re EV experts. This article is not intended to provide tax, legal, financial, or accounting advice. Please check in with your financial and legal advisors before making transactional decisions.

How Much is the Maryland EV Tax Credit?

While Funds are available, you may receive up to $3,000 as an excise tax credit. This amount comes in a few tiers based on the type of EV you buy:

• Up to $1,000 for electric motorcycles (or other two-wheeled plug-in electric vehicles)
• Up to $2,000 for 3-wheeled plug-in electric vehicles
• Up to $3,000 for 4-wheeled plug-in electric vehicles

What is an excise tax? It’s basically a sales tax that is levied on a specific product. In this case, Maryland has a specific excise tax for vehicle sales.

Maryland currently charges an excise tax on new vehicles* registered in the state at a rate of 6% of the vehicle’s base price (as recorded on the Monroney sticker). The amount you may receive as your EV tax credit is tied to the amount you pay in excise tax at the time of purchase; for example, a new Tesla Model 3 RWD with a base MSRP of $38,990 would incur an additional $2,339.40 excise tax in order to be titled and registered in the state of Maryland. Under the current program, that amount ($2,339.40) would be refunded back to you if your application to the EV Excise Tax Credit program is accepted and funding is available.

Unlike the Federal Tax Credit, the Maryland EV Excise Tax Credit is refundable, and the money comes from designated funding set aside by the state. Application to the program happens post-sale with paperwork completed by both you and your dealership. The state recommends that buyers ask dealerships if the state still has funding for the program before purchasing.

*The State of Maryland actually levies the vehicle excise tax on all vehicle sales and transfers of ownership on new or used vehicles, and the details can get complicated. You can check out Maryland’s Motor Vehicle Association website for more information.

Who Qualifies for the Maryland Electric Vehicle Tax Credit?

If you are a resident of the state of Maryland, you should be eligible for Maryland’s EV tax credit.

As of February 21, 2024, the Maryland EV tax credit has no individual income limitation for eligibility, though that may change in the future. For example, House Bill 689 is currently under discussion and, if passed, would limit the credit to middle and lower income individuals (similar to the Federal EV Tax Credit). However, this requirement would not be implemented for credit eligibility in 2023 and 2024.

The credit is intended only for vehicles that are titled and used in the state of Maryland, so you can’t get the credit by buying the vehicle in Maryland and titling it in another state. There are no guidelines yet for how long you have to own the vehicle to keep the credit, but the intent of the law is to provide new EV buyers with a tax break (and not to give a tax break to individuals purchasing an EV for resale).

You’ll only be able to receive one credit during the years that the program runs. However, if you jointly own a vehicle with someone else, only one of you has to use your tax credit opportunity. Or, if you jointly purchase two EVs, you can each apply your credit to one of them.

If you are buying eligible EVs as a business entity, you can apply for and receive up to ten excise tax credits.

Which Vehicles are Eligible for the Maryland EV Tax Credit?

Maryland’s EV TAX credit is only for new electric vehicle purchases. The EV must be purchased, registered and titled in the state after July 1st, 2023 and before July 1st, 2027 (see FAQ at the end of this article for discussion on earlier EV purchases and tax credit programs in Maryland).

In order to be considered for the program, the vehicle must be a zero-emission, plug-in electric or fuel cell electric vehicle. Plug-in hybrids (PHEVs) are included in this category, too. Plug-in electric cars, trucks, and vans must have at least a 5 kWh battery to qualify, and motorcycles need to have at least a 4 kWh battery.

After the new in-state purchase and battery requirements, the main eligibility concern for receiving the credit is that the vehicle’s MSRP must be less than $50,000. Many new—and popular—EVs sell under this price, but this limit does unfortunately exclude some vehicle categories. For example, there are very few fully electric trucks and only a handful of electric SUVs available below the $50,000 cap.

Here are some of the top-selling EVs in the US that qualify for the Maryland EV Excise Tax Refund:

*2023 or 2024 MSRP values and trim levels used where possible

Note: the $50,000 price cap is decided by base MSRP only, and does not take manufacturer’s rebates or trade-in reductions into consideration. Under the current rules, even if you make a deal with the seller and pay less than $50,000 for the EV, the base price on the EV’s Monroney sticker is what qualifies or disqualifies you for the excise tax credit.

How Do I Get the Maryland EV Tax Credit?

To get the Maryland EV Excise Tax Credit for an EV purchased while funding is still available, send the following documents to the Maryland Motor Vehicle Administration via the email listed on their website:

1. A completed VR-334 form (completed with your EV dealer)
2. A copy or photo your EV’s window sticker (called the Monroney Sticker)
3. A copy of your EV’s bill of sale

Don’t Qualify for the Maryland EV Tax Credit? No Problem!

Maybe the electric vehicle you hope to buy is over the $50,000 base price restriction for the Maryland electric vehicle tax credit (such as the 7-Seater Model Y or the Rivian R1S). Does that mean you can’t find a good deal on an EV if you live in the State of Maryland? Of course not!

Used EVs are added every day on our site at a wide range of prices. From the Ford F-150 Lightning to the Lucid Air, you can find an electric vehicle that will fit your needs (and your budget) listed on Find My Electric.

Check out our listings and find your next ride today!