Does Your Next PHEV Qualify for a Federal Tax Credit? Here’s the List

October 1

hybrid feature — Every PHEV Eligible for the Federal Tax CreditPhoto Illustration by Roy Ritchie – Car and Driver

As the conversation around electric cars continues to evolve, more and more people are looking into electrifying their rides. For some, the thought of fully leaving the gas station behind is a step too far. Automakers such as Ford, Hyundai, and Volvo offer an intermediate step with plug-in hybrids that attempt to combine the best of both worlds.

As with a normal gas car, PHEVs have an internal-combustion engine, but—as with fully electric vehicles—they also have one or more electric motors that are fed by a battery pack that can be charged using a plug. Plug-in hybrids can run on electric power alone, though often for no more than 20 to 60 miles. They can also be used similarly to regular hybrids, which lack a plug and useful electric-only range but use an electric motor to improve fuel efficiency. Finally, as with some EVs, a handful of PHEVs are currently eligible for a federal tax credit, though the list is smaller than the actual amount on the market. We’ve compiled the group below based on the EPA’s list of every PHEV that is eligible for the incentive.

For a more in-depth look at how EV tax credits work and the new ruleset that went into effect on January 1, 2024, check out our dedicated article here.

About the Federal Tax Credit

How Do Tax Credits Work?

2024 Audi Q5 Plug-In Hybrid ($3750)

The Audi Q5 is in a bit of a pickle. Audi bestowed the compact luxury crossover with a head-to-toe makeover for 2025—though the company is still selling the previous model alongside the new one. While the updated Q5 is equipped with standard all-wheel drive and a 268-hp turbocharged four-cylinder, the previous generation is available with a plug-in-hybrid option that generates 362 horsepower. We managed 26 mpg on our 75-mph fuel-economy route, although the PHEV only achieved 17 of its 23 estimated electric-only miles. Pricing for the plug-in hybrid starts at $59,795 before the $3750 tax credit.

2024 Chrysler Pacifica Plug-In Hybrid ($7500)

The Chrysler Pacifica Plug-In Hybrid is only offered with front-wheel drive. Its PHEV powertrain musters 260 horsepower from a gas-fed 3.6-liter V-6 and two electric motors, which are fed by a 16.0-kWh lithium-ion battery pack that allows the van to travel 33 miles on electrons alone. In typical minivan fashion, the Pacifica is full of practicality. The interior has seating for seven, it’s packed with cupholders and slide-out bins, and though the standard seats are less comfortable than rivals, they effortlessly fold flat. Pricing for the hybrid model starts at $52,750, and it’s the only PHEV on the list that’s eligible for the full $7500 tax credit.

2024 Ford Escape Plug-In Hybrid ($3750)

The plug-in-hybrid Ford Escape adds pure-electric power to a familiar car. While the standard hybrid can be had with all-wheel drive, the plug-in is front-drive only. It pairs a 2.5-liter four-cylinder engine with an electric motor and generates a combined 210 horsepower. The electric motor is juiced by an 11.7-kWh battery pack that we squeezed 30 miles of electric-only highway driving from. Pricing for the plug-in hybrid starts at $41,995 before the $3750 tax credit.

2024 ford escape phev — Marc Urbano – Car and Driver

2024 Jeep Grand Cherokee 4xe ($3750)

After cementing itself as a stalwart in the mid-size SUV segment over multiple decades, the Jeep Grand Cherokee added a plug-in-hybrid 4xe option in 2022. The electrified setup adds 72 horsepower and 210 pound-feet over the standard V-6 and, more importantly, an EPA-estimated 23 miles of electric-only range. Pricing starts at $62,285 for the entry model and can climb to over $80,945 for the top-of-the-line Summit Reserve trim before the $3750 tax credit.

2024 Jeep Wrangler 4xe ($3750)

The Jeep Wrangler 4xe uses the same basic recipe as the standard Wrangler, except it adds a 14.0-kWh lithium-ion battery and a pair of electric motors. It carries an EPA-estimated electric-only range of 21 miles and earns a combined rating of 49 MPGe (versus 20 mpg running solely on gasoline). Pricing for the PHEV Wrangler starts at $52,590 and can crest $72,240 on the Rubicon X model before the $3750 tax credit.

2024 jeep wrangler 4xe rubicon x — Michael Simari – Car and Driver

2024 Lincoln Corsair Grand Touring ($3750)

Lincoln’s smallest SUV is based on the Ford Escape, but that doesn’t keep it from punching above its weight class. The plug-in-hybrid powertrain is reserved for the top trim and combines a 2.5-liter four-cylinder with an electric motor, a continuously variable automatic transmission (CVT), and all-wheel drive. The EPA rates it at 28 miles of all-electric driving range and estimates 34 mpg city and 32 mpg highway. However, we observed a lower 24 MPGe in our testing. Pricing for the PHEV Corsair starts at $55,760 before the $3750 tax credit.