Instructions For Form 8936 - Qualified Plug-In Electric Drive Motor Vehicle Credit - 2016

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2016
Department of the Treasury
Internal Revenue Service
Instructions for Form 8936
Qualified Plug-in Electric Drive Motor Vehicle Credit (Including Qualified
Two-Wheeled Plug-in Electric Vehicles)
Section references are to the Internal Revenue Code unless
for which it qualifies. The manufacturer or domestic distributor
otherwise noted.
should be able to provide you with a copy of the IRS letter
acknowledging the certification of the vehicle.
Future Developments
If, however, the IRS publishes an announcement that the
For the latest information about developments related to Form
certification for any specific make, model, and model year
8936 and its instructions, such as legislation enacted after they
vehicle has been withdrawn, you cannot rely on the certification
were published, go to
for such a vehicle purchased after the date of publication of the
What's New
withdrawal announcement.
The credit for qualified two-wheeled plug-in electric vehicles is
If you purchased a vehicle and its certification was withdrawn
scheduled to expire for vehicles acquired after 2016. Do not
on or after the date of purchase, you can rely on such
claim a credit for these vehicles on Form 8936 unless the credit
certification even if you had not placed the vehicle in service or
is extended.
claimed the credit by the date the withdrawal announcement
was published by the IRS. The IRS will not attempt to collect any
General Instructions
understatement of tax liability attributable to reliance on the
certification as long as you purchased the vehicle on or before
Purpose of Form
the date the IRS published the withdrawal announcement.
Use Form 8936 to figure your credit for qualified plug-in electric
The following requirements must be met to qualify for the
drive motor vehicles you placed in service during your tax year.
credit.
Also use Form 8936 to figure your credit for certain qualified
You are the owner of the vehicle. If the vehicle is leased, only
two-wheeled plug-in electric vehicles.
the lessor and not the lessee, is entitled to the credit.
You placed the vehicle in service during your tax year.
The credit attributable to depreciable property (vehicles used
The vehicle is manufactured primarily for use on public
for business or investment purposes) is treated as a general
streets, roads, and highways.
business credit. Any credit not attributable to depreciable
The original use of the vehicle began with you.
property is treated as a personal credit.
You acquired the vehicle for use or to lease to others, and not
Partnerships and S corporations must file this form to claim
for resale.
the credit. All other taxpayers are not required to complete or file
You use the vehicle primarily in the United States.
this form if their only source for this credit is a partnership or S
Exception. If you are the seller of a qualified plug-in electric
corporation. Instead, they can report this credit directly on line 1y
drive motor vehicle or qualified two-wheeled plug-in electric
in Part III of Form 3800, General Business Credit.
vehicle to a tax-exempt organization, governmental unit, or a
Qualified Plug-in Electric Drive Motor
foreign person or entity, and the use of that vehicle is described
in section 50(b)(3) or (4), you can claim the credit, but only if you
Vehicle
clearly disclose in writing to the purchaser the amount of the
tentative credit allowable for the vehicle (from line 11 of Form
This is a new vehicle with at least four wheels that:
8936). Treat all vehicles eligible for this exception as business/
Is propelled to a significant extent by an electric motor that
investment property. If you elect to claim the credit, you must
draws electricity from a battery that has a capacity of not less
reduce cost of goods sold by the amount you entered on line 11
than 4 kilowatt hours and is capable of being recharged from an
for that vehicle.
external source of electricity, and
Has a gross vehicle weight of less than 14,000 pounds.
More information. For details, see the following.
Section 30D.
Qualified Two-Wheeled Plug-in
Notice 2009-89, 2009-48 I.R.B. 714, available at
Electric Vehicle
irb/2009-48_IRB/ar09.html.
Notice 2013-67, 2013-45 I.R.B. 470, available at
This is a new vehicle with two wheels that:
irb/2013-45_IRB/ar05.html.
Is capable of achieving a speed of 45 miles per hour or
Notice 2016-51, 2016-37 I.R.B. 344, available at
greater,
irb/2016-37_IRB/ar06.html.
Is propelled to a significant extent by an electric motor that
Credit Phaseout
draws electricity from a battery that has a capacity of not less
than 2.5 kilowatt hours and is capable of being recharged from
The credit for vehicles with at least four wheels is subject to a
an external source of electricity, and
phaseout (reduction) once the vehicle manufacturer (or, for a
Has a gross vehicle weight of less than 14,000 pounds.
foreign manufacturer, its U.S. distributor) sells 200,000 of these
Certification and Other Requirements
vehicles to a retailer for use in the United States after 2009. The
phaseout begins in the second calendar quarter after the quarter
Generally, you can rely on the manufacturer’s (or, in the case of
in which the 200,000th vehicle was sold. Then the phaseout
a foreign manufacturer, its domestic distributor’s) certification to
allows 50% of the full credit for 2 quarters, 25% of the full credit
the IRS that a specific make, model, and model year vehicle
for 2 additional quarters, and no credit thereafter.
qualifies for the credit and, if applicable, the amount of the credit
Dec 08, 2016
Cat. No. 67912V

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