The rules changed in 2025, and a lot of what you may have read about EV tax credits no longer applies. The federal EV tax credit has ended, and New Jersey no longer waives sales tax on electric vehicles. This guide clears up what expired, when it expired, and which incentives can still lower the cost of going electric in 2026.
The Big Picture: What Ended and What Is Left
Here is the short version for New Jersey drivers in 2026:
- Federal EV tax credits have ended. The up to $7,500 new EV credit, the $4,000 used EV credit, and the commercial and leasing credit all ended for vehicles acquired after September 30, 2025.
- New Jersey no longer exempts EVs from sales tax. The full 6.625% state sales tax has applied to electric vehicles since July 1, 2025.
- The federal home charger credit has ended. The 30% credit for a home charger applied only if the charger was placed in service by June 30, 2026.
- Some incentives can still help, most notably the Charge Up New Jersey point of sale rebate when it is funded, plus manufacturer lease incentives and the lower running costs of driving electric.
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The Federal EV Tax Credit Has Ended
For years, buyers could claim a federal credit of up to $7,500 on a qualifying new EV and up to $4,000 on a used one. That era is over. Under the One Big Beautiful Bill Act (Public Law 119-21), the following federal credits ended for vehicles acquired after September 30, 2025:
- New Clean Vehicle Credit (Section 30D), worth up to $7,500 on a new EV
- Used Clean Vehicle Credit (Section 25E), worth up to $4,000 on a qualifying used EV
- Commercial Clean Vehicle Credit (Section 45W), which many automakers passed through as a discount on leased EVs
These credits were originally scheduled to run through 2032, so this is a major change. If you did not acquire your EV on or before September 30, 2025, the federal credit is no longer available. There is no income limit, MSRP cap, IRS approved model list, or Form 8936 point of sale transfer to plan around anymore, because the credit itself is gone.
One practical effect worth knowing: because the commercial credit (Section 45W) has ended, EV leases no longer come with an automatic $7,500 federal discount baked into the payment. Any lease savings you see now come from the automaker, not the federal government.
New Jersey No Longer Waives Sales Tax on EVs
New Jersey used to exempt zero emission vehicles from state sales tax, which was one of the best EV deals in the country. That exemption has been phased out:
- Through September 30, 2024: full exemption, meaning 0% sales tax on eligible EVs
- October 1, 2024 to June 30, 2025: a reduced rate of 3.3125%
- July 1, 2025 and after: the full 6.625% state sales tax, the same rate as a gas car
In real numbers, a $45,000 EV now carries roughly $2,980 in state sales tax before any rebate. If you read an older article that says "New Jersey charges no sales tax on EVs," that information is out of date.
New Jersey also charges an annual zero emission vehicle registration fee on top of standard registration. It is $270 for the year running July 1, 2026 to June 30, 2027, and it rises by $10 each year through 2028. For a brand new EV, four years of that fee can be collected at the initial four year registration, so it is worth budgeting for.
The Federal Home Charger Credit Has Ended Too
The federal Alternative Fuel Vehicle Refueling Property Credit (Section 30C) gave homeowners 30% of the cost of a home charger, up to $1,000. Under the One Big Beautiful Bill Act, this credit ended for equipment placed in service after June 30, 2026. "Placed in service" means fully installed and working, not just purchased.
What Still Saves You Money on an EV in 2026
The federal credits are gone, but a few incentives can still bring your cost down. Here is where the real savings live now.
Charge Up New Jersey (when it is funded)
Charge Up New Jersey is a state rebate of up to $4,000 toward the purchase or lease of an eligible new battery electric vehicle, applied as a discount at the point of sale, plus up to $250 toward a home charger. The important caveat: this program runs on an annual budget and pauses when the money runs out. Its fiscal year 2027 point-of-sale program launched on July 1, 2026. Before you count on it, confirm the current status and eligible vehicle list directly with the program, because both the funding and the qualifying models change from year to year.
Manufacturer lease and finance incentives
With the federal lease credit gone, automakers have leaned into their own EV lease and finance offers to keep electric models moving. These change often and vary by brand and model, but a strong manufacturer incentive can matter more than any tax credit did. This is exactly the kind of moving target where a broker helps.
Lower running costs
Even without the tax credits, EVs can be cheaper to operate than gas cars thanks to lower fueling and maintenance costs. Just weigh those savings against New Jersey's annual EV registration fee so you have a realistic picture of the total cost of ownership.
How Vantage Auto Group Can Help
At Vantage Auto Group, we help you cut through the noise so you know what is actually available today, not last year. We can:
- Explain which incentives currently apply to the EV you want
- Check whether Charge Up New Jersey is funded and which vehicles qualify
- Compare manufacturer lease and finance offers across brands to find the strongest deal
- Coordinate the paperwork and delivery so the process stays simple
Our job is to make the EV buying and leasing process clearer and lower stress, so you can focus on the car instead of the fine print. Get Started and we will walk you through it.
The Bottom Line
The federal EV tax credit and New Jersey's sales tax exemption are both gone, so the biggest savings of the past few years are no longer on the table. The smart move in 2026 is to focus on what still works: the Charge Up New Jersey rebate when it is funded, the right manufacturer lease incentive, and the lower running costs of driving electric. With the rules shifting this fast, it pays to have a team confirming the current details for you.
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