Will Hyundai or Kia EVs Qualify for the Electric Vehicle Tax Credit?

The electric vehicle tax credit has spurred concern that Kia and Hyundai EVs won’t qualify—without some flexibility.

electric vehicle symbol on asphault
(Image credit: Getty Images)

Kia is among some major industry manufacturers that have expressed concern over new sourcing and assembly requirements in the Inflation Reduction Act (IRA). Signed by President Biden last year, the IRA is a massive climate, energy, healthcare, and tax law that also unveiled a revamped electric vehicle tax credit.

To spur domestic EV production,” the Inflation Reduction Act requires that final assembly of so called “clean vehicles” occur in North America, for those EVs to qualify for the EV tax credit. The final assembly requirement became effective August 16, 2022. There is a similar requirement in the Inflation Reduction Act, that minerals and other key components (i.e., battery components), which are used to manufacture electric vehicles, also be primarily sourced in North America—by 2026.

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Kelley R. Taylor
Senior Tax Editor, Kiplinger.com

As the senior tax editor at Kiplinger.com, Kelley R. Taylor simplifies federal and state tax information, news, and developments to help empower readers. Kelley has over two decades of experience advising on and covering education, law, finance, and tax as a corporate attorney and business journalist.