Alternative Fuel and Hybrid Electric Vehicle Tax Credit

Expired: 12/31/2010

Beginning July 1, 2000, the Alternative Fuel Vehicle Credit is available from the Colorado Department of Revenue for a motor vehicle titled and registered in Colorado that uses or is converted to use an alternative fuel or is a hybrid electric vehicle. Alternative fuels include electricity, compressed natural gas, propane, ethanol, or any mixture of ethanol containing 85% or more ethanol by volume with gasoline or other fuels. The credit is a percentage of the incremental cost of the vehicle or the vehicle conversion as follows:

Category Credit Amount
Low-emitting vehicle (LEV) 50%
Ultra-low-emitting vehicle (LUEV) or Inherently-low emitting vehicle (ILEV) 75%
Zero-emitting vehicle (ZEV or SULEV) 85%

Vehicle categories are outlined in Title 40 of the Code of Federal Regulations, part 88. The tax credit percentage is doubled, up to a maximum of 100%, if the vehicle permanently replaces a vehicle that is ten years old or older and will never be operated on Colorado highways in the future. This credit is available through the tax year beginning on January 1, 2010. For additional information, see the Department of Revenue’s Income 9 FYI publication.

(Reference Colorado Revised Statutes 39-22-516.2.5)