Back when the Inflation Reduction Act (IRA) of 2022 originally took effect, a large number of new all-electric and hybrid vehicles became eligible for a $7,500 federal EV tax credit, and in some cases, half that amount, depending on certain factors. Shortly thereafter, increasing restrictions on countries of origin as it pertains to components like raw materials resulted in many vehicles exiting that eligibility list, meaning that today, only a couple of new Blue Oval models qualify – the Ford F-150 Lightning and Ford Escape PHEV. However, that won’t be the case much longer.
As Ford Authority previously reported, the F-150 Lightning is currently the only model in Ford’s lineup that qualifies for the full $7,500 federal tax credit, but the Ford Escape PHEV also qualifies for half of it – $3,750. However, as Ford Authority reported last week, that same federal EV tax credit is now set to end on September 30th, 2025, following the passage of President Donald Trump’s “big beautiful bill” in both the Senate and House of Representatives.
That means that those who qualify for the existing federal EV tax credit and wish to take advantage of it only have a few more weeks to do so, as it pertains to both the Ford Escape PHEV and F-150 Lightning. Additionally, certain used models qualify for a $4,000 tax credit as well, but that same incentive will also end at the conclusion of September. As for folks interested in purchasing an Escape in general, well, they might not have a lot of time left to snag a new one from dealer lots, either.
That’s because – just as the Ford Escape is celebrating 25 years of existence – the small crossover is reportedly set to be discontinued following the 2026 model year and potentially replaced by a new all-electric vehicle on the lines at the Louisville Assembly plant. The 2026 Ford Escape won’t be sold in six U.S. states due to the forthcoming implementation of stricter emission rules, too.
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