Colorado's EV Tax Credit in 2026: Up to $3,250 + A $9,000 Rebate
Colorado’s 2026 EV tax credit is $750 or up to $3,250 for lower-priced EVs. See eligibility, forms, point-of-sale rules and the $9,000 VXC rebate.
Colorado still offers a valuable state electric vehicle tax credit—often called the Colorado electric car tax credit—in 2026, but the amount is much lower than it was in 2025.
For an eligible new electric vehicle, plug-in hybrid or hydrogen fuel-cell vehicle purchased or leased in 2026, the refundable Colorado EV tax credit is $750. A qualifying vehicle with a manufacturer’s suggested retail price under $35,000 can receive an additional $2,500, bringing the maximum state credit to $3,250.
Some income-qualified Coloradans can save substantially more. Vehicle Exchange Colorado provides a separate point-of-sale rebate of $9,000 for a new EV or $6,000 for a used EV when an eligible older or high-emitting gasoline or diesel vehicle is surrendered. That rebate can be combined with the Colorado tax credit when all requirements are met.
This guide explains which vehicles qualify, how the dealership discount works, what to do at tax time and how to avoid outdated EV incentive information.
2026 Colorado EV incentive at a glance:
A qualifying new EV with an MSRP from $35,000 through $80,000 receives $750. A qualifying new EV with an MSRP under $35,000 may receive $3,250 total. Income-qualified drivers who use Vehicle Exchange Colorado may receive another $9,000 toward a new EV or $6,000 toward a used one.
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How much is the Colorado EV tax credit in 2026?
The amount depends primarily on the vehicle’s MSRP—not the price you negotiate with the dealer.
| Vehicle purchased or leased in 2026 | Colorado tax credit |
|---|---|
| Qualifying new EV, PHEV or FCEV with an MSRP of $35,000 to $80,000 | $750 |
| Qualifying new EV, PHEV or FCEV with an MSRP under $35,000 | $3,250 ($750 + $2,500) |
| Vehicle with an MSRP over $80,000 | $0 |
| Used EV | $0 from this tax credit |
Colorado EV tax credit by year: 2025–2028
| Vehicle year | Base credit | Additional lower-MSRP credit | Maximum available |
|---|---|---|---|
| 2025 | $3,500 | $2,500 under $35,000 | $6,000—or $6,600 if assigned |
| 2026 | $750 | $2,500 under $35,000 | $3,250 |
| 2027, scheduled | $2,000 | $2,500 under $40,000 | $4,500 |
| 2028, scheduled | $1,000 | $2,500 under $40,000 | $3,500 |
The 2027 and 2028 amounts are scheduled under current law but remain subject to Colorado’s forecast-based adjustment mechanism. Different MSRP ceilings also apply beginning in 2027.
Colorado’s Department of Revenue confirms the $750 base credit for purchases and leases in tax year 2026. The same guidance confirms the additional $2,500 credit for an otherwise eligible vehicle with an MSRP under $35,000.
The thresholds are not interchangeable:
- A vehicle priced at exactly $35,000 does not receive the $2,500 lower-price credit because the law says the MSRP must be under $35,000.
- A vehicle can qualify for the $750 base credit as long as its MSRP is not greater than $80,000 and it meets the other rules.
- A dealer discount does not move a $36,000-MSRP vehicle into the under-$35,000 tier.
Colorado generally uses the MSRP shown on the federally required window label, including manufacturer-installed options. Destination charges, dealer-installed options, taxes and fees are excluded from this MSRP calculation. Check the specific vehicle’s window sticker rather than relying only on a model’s advertised starting price.
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Which vehicles qualify for the Colorado EV tax credit?
An eligible light-duty vehicle must meet all of the following requirements:
- Be new when purchased or leased
- Have four wheels
- Have a maximum speed of at least 55 mph
- Have a gross vehicle weight rating of 8,500 pounds or less
- Be propelled to a significant extent by an electric motor
- Have a battery of at least 4 kilowatt-hours that can be recharged from an external electricity source—or meet Colorado’s requirements for a hydrogen fuel-cell vehicle
- Be titled and permanently registered in Colorado
- Have an eligible MSRP of no more than $80,000
This means qualifying battery-electric vehicles and many plug-in hybrids can receive the credit. Unlike the former federal clean-vehicle credit, Colorado’s consumer credit does not impose North American final-assembly, battery-component, critical-mineral or buyer-income restrictions.
There is also no published list of qualifying models comparable to the former federal list. Eligibility follows Colorado’s statutory vehicle rules and the individual vehicle’s MSRP and specifications. Confirm the window-sticker MSRP, battery capacity and GVWR before signing.
Do demonstration vehicles qualify?
A dealer demonstrator can still be considered new if it has not been previously titled or registered and its demonstration use does not exceed 1,500 miles. A vehicle previously titled or registered in Colorado or another jurisdiction is not new for this credit.
Do electric trucks qualify?
An electric pickup or other vehicle with a GVWR of 8,500 pounds or less generally falls under the motor-vehicle credit described here. A passenger vehicle or truck above that threshold may instead fall under Colorado’s separate Innovative Truck Credit, which has different classifications and amounts.
Is there an income limit for the Colorado EV tax credit?
No. The Colorado Innovative Motor Vehicle Credit itself has no buyer-income cap.
Individuals and several other types of taxpayers may qualify. Since 2024, eligible tax-exempt organizations and Colorado local governments may also claim or assign the credit. Colorado residency is not expressly required, but the vehicle must be titled and registered in Colorado. The Department of Revenue gives a nonresident military servicemember stationed in Colorado as an example of someone who may qualify.
Do not confuse this with Vehicle Exchange Colorado. That separate $9,000 or $6,000 rebate is income-qualified and requires an eligible vehicle to be surrendered.
Can you get the Colorado EV tax credit at the dealership?
Yes—if the dealer or financing entity accepts assignment of the credit.
Assignment turns the future tax credit into immediate value. The credit must be reflected at the time of purchase or lease as a cash payment, price reduction, capitalized-cost reduction or similar consideration. The amount must be stated separately in the purchase, lease or loan agreement.
You and the participating dealer or financing entity must complete Colorado form DR 0618, Innovative Motor Vehicle Tax Credit Election Statement, at the time of the transaction.
Important details:
- A dealer is not required to accept the credit.
- The dealer or financing entity may deduct an administrative fee of up to $250.
- If you assign the credit, you cannot also claim it on your Colorado return.
- In 2026, there is no longer a special $600 bonus for assignment. That temporary addition applied only before 2026.
- Ask the dealer to show the state credit and any administrative fee separately before you agree on the final numbers.
For a $750 credit, a dealer charging the maximum $250 fee would leave the buyer with $500 of immediate value. That makes it worth comparing assignment with claiming the full refundable credit later—although waiting requires completing the tax-return process and obtaining permanent registration first.
How do you claim the Colorado EV credit on your tax return?
If you do not assign the credit at the dealership, claim it on the Colorado income tax return for the year in which you take possession of the vehicle.
Colorado requires:
- A completed DR 0617, Innovative Motor Vehicle and Innovative Truck Credit, for each vehicle
- A copy of the vehicle’s permanent Colorado registration
- A copy of the invoice, purchase agreement or lease agreement
A temporary registration is not enough. If your permanent registration has not arrived by the time you are ready to file, wait until you receive it before claiming the credit.
The credit is refundable. If your allowable credit exceeds your Colorado income-tax liability, the excess is paid as part of your refund. For example, a qualifying $3,250 credit does not shrink merely because you owe only $1,000 in Colorado income tax.
The relevant year generally depends on when you take possession—not when you order the vehicle or pay a reservation fee. This matters around December 31 because Colorado’s credit amounts and MSRP rules can change from one calendar year to the next.
Does a leased EV qualify in Colorado?
Yes. Colorado provides the same 2026 amount for an eligible purchase or lease: $750, plus the possible $2,500 lower-MSRP credit.
The original lease term must be at least two years. For a qualifying lease, the credit belongs to the lessee rather than the leasing company. The lessee can claim it on a Colorado return or assign it to a participating dealer or financing entity.
Colorado guidance says early termination of a bona fide lease originally written for at least two years does not, by itself, cancel or recapture a credit already claimed.
Before comparing lease offers, identify whether the advertised payment already assumes the Colorado credit. Otherwise, it is easy to count the same incentive twice.
Is there a Colorado used-EV tax credit in 2026?
There is no general Colorado Innovative Motor Vehicle Credit for a used EV in 2026. Used vehicles are explicitly excluded.
The former federal previously owned clean-vehicle credit also ended for vehicles acquired after September 30, 2025. A page promising a broadly available $4,000 federal used-EV credit in 2026 is outdated.
However, an income-qualified Coloradan replacing an eligible older or high-emitting vehicle may be able to receive $6,000 toward an eligible used EV through Vehicle Exchange Colorado.
Vehicle Exchange Colorado: $9,000 for a new EV or $6,000 for a used EV
Vehicle Exchange Colorado (VXC) is a statewide, income-qualified vehicle-replacement program. It is separate from the tax credit and must be approved before the purchase or lease.
Current rebate amounts are:
| Eligible replacement vehicle | VXC point-of-sale rebate |
|---|---|
| New EV or qualifying plug-in hybrid | $9,000 |
| Used EV or qualifying plug-in hybrid | $6,000 |
The higher amounts took effect November 3, 2025. They are point-of-sale rebates, not payments that can be requested after buying a car.
VXC generally requires the applicant to:
- Be at least 18 and provide proof of a physical Colorado address
- Have household income below 80% of area median income, or be enrolled in a qualifying income-assistance program
- Receive program approval before the vehicle transaction
- Surrender an operational gasoline- or diesel-powered vehicle that is at least 12 model years old or has failed a Colorado emissions test
- Hold clear Colorado title to the surrendered vehicle, without a lien, and satisfy the program’s ownership and registration rules
- Buy or lease through an authorized VXC dealer before the rebate expires
The replacement vehicle must also meet VXC requirements. A new vehicle generally must have an MSRP of $80,000 or less, while a used vehicle must have a final negotiated price of $50,000 or less. The applicant must be the primary purchaser or lessee, and a lease must last at least two years.
The surrendered vehicle is permanently taken off the road and recycled. You do not receive separate trade-in value for it in addition to the VXC rebate. VXC is limited to one rebate per tax household.
The VXC rebate cannot exceed the remaining purchase or lease price after other rebates, discounts, credits and incentives are applied.
Apply before selecting or purchasing the replacement vehicle and allow time for income and vehicle-document verification. Approval and redemption deadlines can change, so confirm the current deadline shown on your VXC approval notice before shopping. Confirm current documentation and other requirements in the program’s official FAQ and terms.
Dealer-price warning: Some advertised EV prices already subtract VXC or other conditional incentives. Ask for an itemized out-the-door quote showing the vehicle price, dealer discount, Colorado tax credit, VXC rebate, taxes and fees separately.
Can VXC and the Colorado EV tax credit be combined?
Yes. VXC explicitly permits stacking with other eligible rebates and tax credits.
For example, an income-qualified participant replacing an eligible vehicle with a new EV whose MSRP is under $35,000 could potentially combine:
- $9,000 Vehicle Exchange Colorado rebate
- $750 Colorado base EV credit
- $2,500 Colorado lower-MSRP credit
That produces $12,250 in combined Colorado incentives, before any eligible utility or local assistance. This is not automatic: the buyer, old vehicle, replacement vehicle, dealer and timing must independently satisfy each program.
Other Colorado EV rebates and incentives in 2026
Colorado does not have one universal utility rebate. Availability depends on the company that supplies electricity to your home, and programs can close when funding is exhausted.
Examples current as of this article’s fact-check date include:
- Xcel Energy: Its Colorado Charging Perks program advertises a $50 enrollment credit and a $150 annual participation incentive for eligible customers. Xcel’s EV Accelerate At Home program closed to new Colorado applications on July 14, 2026, although some existing participants may still qualify for associated wiring assistance.
- Holy Cross Energy: Eligible members can receive up to $549 toward an approved Level 2 charger through Charge at Home. Participation allows the utility to delay charging during certain peak periods, with an opt-out mechanism.
- Local utilities and cooperatives: Programs, rates and equipment requirements vary. Check your provider’s current EV page before buying a charger or beginning electrical work.
What changes for the Colorado EV tax credit in 2027?
Under HB26-1289, which became law June 3, 2026, Colorado changed the scheduled rules for vehicles purchased or leased on or after January 1, 2027.
Before any revenue-forecast adjustment, the scheduled 2027 credit is $4,500 for a qualifying vehicle with an MSRP under $40,000 and $2,000 for a qualifying vehicle with an MSRP from $40,000 through $50,000. Vehicles with an MSRP above $50,000 will not qualify. The law schedules a $1,000 base credit for 2028, plus the $2,500 additional credit for a qualifying vehicle under $40,000.
These future amounts remain subject to Colorado’s statutory revenue-forecast adjustment mechanism. Anyone taking delivery near year-end should check the Department of Revenue’s updated table before deciding whether 2026 or 2027 is more favorable. An order placed in 2026 does not generally lock in the 2026 amount if possession occurs in 2027.
Common Colorado EV-credit mistakes to avoid
Assuming the 2025 amount still applies
The base credit fell from $3,500 in 2025 to $750 in 2026. The temporary $600 assignment bonus also ended.
Treating a sale price as MSRP
The under-$35,000 test uses qualifying window-sticker MSRP, not the final negotiated price after discounts.
Buying a vehicle that was previously titled
A low-mileage vehicle is still considered used—and therefore ineligible for Colorado’s new-vehicle tax credit—if it was previously titled or registered. Verify its status, particularly for demos, service loaners and dealer transfers.
Claiming before permanent registration arrives
Colorado requires permanent registration when claiming the credit on a return. A dealer-issued temporary permit is insufficient.
Assigning the credit and claiming it again
Assignment gives the credit to the dealer or financing entity. You cannot then claim the same credit on your return.
Purchasing before VXC approval
VXC is not a post-purchase rebate. Apply, receive approval and follow the program’s authorized-dealer process before completing the transaction.
Overlooking the assignment fee
The maximum $250 administrative fee is especially consequential against a $750 base credit. Ask for the net amount in writing.
A five-step checklist before buying an EV in Colorado
- Check the exact window sticker. Confirm MSRP, manufacturer-installed options and GVWR for the specific vehicle—not merely the advertised base trim.
- Determine your state-credit tier. A qualifying 2026 vehicle under $35,000 can receive $3,250; a qualifying vehicle priced from $35,000 through $80,000 receives $750.
- Screen for VXC before shopping. If your income and existing vehicle might qualify, apply before purchase and wait for approval.
- Ask how the dealer handles assignment. Confirm whether it accepts DR 0618, how the credit appears in the contract and whether it charges a fee.
- Save every document. Keep the window sticker, signed agreement, permanent Colorado registration and tax-credit forms.
Conclusion: Take the next step
Switching to an EV can reduce gasoline spending while helping improve air quality in Colorado communities.
Colorado’s EV tax credit remains available in 2026, but the base credit is only $750. The best broadly available opportunity is the $3,250 total credit for a qualifying vehicle with an MSRP under $35,000.
The largest savings are reserved for income-qualified drivers replacing an eligible older or high-emitting vehicle. Combining the $9,000 Vehicle Exchange Colorado rebate with the maximum state tax credit can produce $12,250 in Colorado incentives toward a qualifying new EV.
It's best to verify the exact vehicle, program status and paperwork before purchase. Incentive rules turn on details such as the window-sticker MSRP, prior titling, permanent Colorado registration, delivery date and whether the dealer accepts assignment.
About Coltura: Coltura is a nonprofit working to accelerate the transition beyond gasoline to cleaner, cheaper, locally produced electricity. We provide independent EV information and tools but do not administer Colorado incentive programs or determine eligibility.
Disclaimer: Incentive funding, eligibility, deadlines, approved vehicles and stacking rules can change. This guide provides general information and does not guarantee eligibility. Confirm all requirements with the official program before completing a vehicle purchase, lease, charger installation or vehicle retirement.
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Colorado EV tax credit FAQ
How much is the Colorado EV tax credit in 2026?
The 2026 base credit is $750 for a qualifying new electric, plug-in hybrid or hydrogen fuel-cell vehicle. A qualifying vehicle with an MSRP under $35,000 receives an additional $2,500, for a maximum of $3,250.
Is the Colorado EV tax credit refundable?
Yes. If the credit exceeds your Colorado income-tax liability, the excess is refundable. Alternatively, you may assign it to a participating dealer or financing entity for immediate value.
Does Colorado have an EV tax-credit income limit?
No. The state Innovative Motor Vehicle Credit does not have a buyer-income limit. Vehicle Exchange Colorado is a different, income-qualified program.
Can I get the Colorado EV credit at the point of sale?
Yes, if the dealer or financing entity accepts assignment and you complete form DR 0618 at the time of purchase or lease. The assignee may deduct an administrative fee of up to $250.
Does Colorado offer a plug-in hybrid or PHEV tax credit?
Yes. A new plug-in hybrid may qualify for Colorado’s EV tax credit if it meets the program’s requirements, including an externally rechargeable battery with at least 4 kWh of capacity. Conventional hybrids that cannot be plugged in do not qualify.
Can I claim the credit for a Tesla?
A new Tesla can qualify if the specific vehicle meets Colorado’s technical requirements and MSRP cap and is first titled and registered in Colorado. Colorado does not use the former federal model-eligibility list. The under-$35,000 bonus depends on the specific vehicle’s qualifying window-sticker MSRP.
Can I get a credit for a used EV?
Not through the general Colorado Innovative Motor Vehicle Credit. An income-qualified participant may instead qualify for a $6,000 used-EV rebate through Vehicle Exchange Colorado by surrendering an eligible older or high-emitting vehicle.
Can I combine Colorado’s tax credit with Vehicle Exchange Colorado?
Yes, if you and both vehicles satisfy the separate requirements. The maximum combination for a qualifying new EV under $35,000 is $12,250 in 2026: a $9,000 VXC rebate plus $3,250 in state tax credits.
How long does Vehicle Exchange Colorado approval take?
Allow time for the program to verify your income and vehicle documents before you shop. Processing times and redemption deadlines can change, so apply before selecting or purchasing a replacement vehicle and follow the deadline on your approval notice.
Can I combine VXC with other EV incentives?
VXC generally allows eligible rebates and tax credits to be combined, including Colorado’s state EV tax credit. However, every program has separate requirements, and the VXC rebate cannot exceed the remaining purchase or lease price after other rebates, discounts, credits and incentives are applied.
Does the Colorado credit reduce the vehicle’s taxable purchase price?
No. Colorado state and state-administered local sales taxes are calculated on the full taxable purchase price before subtracting the state credit or VXC rebate.
Which date determines the credit amount?
Generally, the purchase or lease is completed when the buyer or lessee takes possession. That date—not merely the order date—determines the applicable tax year and credit amount.
Can I get the Colorado EV tax credit for an out-of-state purchase?
A vehicle purchased from an out-of-state dealer may qualify if it otherwise meets Colorado’s requirements and is titled and permanently registered in Colorado. If you want the credit at the dealership, the dealer or financing entity must be able and willing to accept assignment under Colorado’s procedures. Otherwise, an eligible taxpayer may claim the credit on a Colorado return with the required documents.
When does the Colorado EV tax credit end?
The Colorado EV tax credit is not scheduled to disappear after 2026. Current law provides different credit amounts and MSRP limits for 2027 and 2028. Future amounts remain subject to Colorado’s revenue-forecast adjustment mechanism, so check the Department of Revenue’s current guidance before purchasing.