EV Tax Credit Only Allowed When Cars First ‘Placed Into Service’

An electric vehicle is “placed into service” for purposes of a federal tax break only in the first year that it was ready, available, and used consistently with its specifically assigned function, the US Tax Court said Wednesday in a precedent-setting opinion.

IRC Section 30D allows a one-time $7,500 electric vehicle tax credit in the year it was placed into service, but doesn’t define the term, Judge Maurice B. Foley said.

However, he said that terminology is defined in regulations pertaining to other sections of the code, and the court previously held that “property is placed in service when it ...