Form 8834, Qualified Electric Vehicle Credit vs. Form 8936, Plug-in Electric Vehicle Credit for Lacerte

Table of contents:

Form 8834, Qualified Electric Vehicle Credit

• You can use Form 8834 to claim any qualified electric vehicle passive activity credit allowed for the current tax year.
• This form only applies to qualified electric vehicle passive activity credits from prior years (allowed on Form 8582-CR or Form 8810 for the current year). For the current tax year, this credit would be allowed on:
  • Form 8582-CR, Passive Activity Credit Limitations (for individuals, trusts, and estates), or
  • Form 8810, Corporate Passive Activity Loss and Credit Limitations (for corporations)

To enter a prior-year carryover of this credit to generate Form 8834:

1. Go to Screen 34, General Bus. & Passive Act. Credits.
2. Scroll to the Prior Year Unallowed Credits section.
3. Locate the grid under the Other Passive Credit Carryovers subsection.
4. For the Credit Type (Ctrl + T), select Qualified plug-in electric vehicle.
   • This is under the Form 3800, Part III, Line 1 Credits dropdown.
5. Enter the applicable amount in the General Business Credit column.

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Form 8936, Qualified Plug-in Electric Drive Motor Vehicle Credit

Beginning in tax year 2025:

Taxpayers can't claim clean vehicle credits for new, previously owned, or commercial clean vehicles that they acquired after September 30, 2025. See the IRS instructions here for more information.

Beginning in tax year 2024:

• For vehicles placed in service after December 31, 2023, the seller must file the seller report through the IRS Energy Credits Online (ECO) portal.
• Transfer of new clean vehicle credit. For vehicles placed in service after 2023, you may be able to transfer the credit amount to the dealer. See the IRS instructions for more information. If you elect to transfer the credit, you must file Form 8936 and Schedule A (Form 8936) with your return for the tax year in which the vehicle was placed in service.

Form 8936 overview

• Use Form 8936 to claim the credit for:
  • Qualified plug-in electric drive motor vehicles placed in service during your tax year.
  • Qualified two-wheeled plug-in electric vehicles acquired after 2014.

Credit classification

• Credit for depreciable property (business or investment vehicles): treated as a general business credit.
• Credit for non-depreciable property (personal vehicles): treated as a personal credit applied against both regular tax and AMT.

Filing requirements

• Partnerships and S corporations: must file Form 8936 to claim the credit.
• All other taxpayers:
  • Don’t complete or file Form 8936 if your only source for this credit is from a partnership or S corporation.
  • Instead, report the credit directly on Form 3800, General Business Credit (Part III, line 1y).

Beginning in TY23: To generate Form 8936 for the 1040 module

1. Go to Screen 34, General Business & Vehicle Credits
2. If this is related to a business activity, in the Credits section, enter the Form (Ctrl+T) using the dropdown, the Activity name or number (Ctrl+T), and Taxpayer, Spouse, or Joint (if applicable).
   • If this is not related to a business activity, continue to step 3.
3. Locate the Clean Vehicle Credit (8936) section on the lower left panel, or by scrolling.
4. For tax year 2024 start by entering the Modified Adjusted Gross Income. This is required for 2024 returns.
5. Enter Part I: Vehicle Details.
6. Continue by answering the questions presented on Screen 34 in order.
7. Follow the directions on the input screen until you complete the input and generate the form, or until you see Stop here which indicates the vehicle doesn't qualify for a credit.
   • If Part II is needed, an entry is required for the tentative credit amount to generate the form.
8. If using the Elective Payment option, use the new Elective Payment fields.
   • If filing an elective payment on the Form 3800 the IRS requires a registration number that you must complete before filing the tax return. See here for more information.

Additionally, make sure to review each blue note referenced on the page to determine whether or not it is applicable to your client.

Beginning in TY23: To generate Form 8936 for the 1065 module

1. Go to Screen 20.1, Fuel Tax Credits
2. From the left side of the screen select Clean Vehicle Credits (8936).
3. Begin by entering the Part I: Vehicle Details.
4. Continue by answering the questions presented on the screen in order.
5. Follow the directions on the input screen until you complete the input and generate the form, or until you see Stop here which indicates the vehicle doesn't qualify for a credit.
   • If Part II is needed, an entry is required for tentative credit amount to generate the form.
6. If using the new Elective Payment option use the new Elective Payment fields.
   • If filing an elective payment on the Form 3800 the IRS requires a registration number that you must complete before filing the tax return. See here for more information.
   • The 3800 will only generate for Partnerships if an Elective Payment or Transfer is used.

Beginning in TY23: To generate Form 8936 for the 1120S module

1. Go to Screen 26.1, Fuel Tax Credits
2. From the left side of the screen select Clean Vehicle Credits (8936).
3. Begin by entering the Part I: Vehicle Details.
4. Continue by answering the questions presented on the screen in order.
5. Follow the directions on the input screen until you complete the input and generate the form, or until you see Stop here which indicates the vehicle doesn't qualify for a credit.
   • If Part II is needed, an entry is required for tentative credit amount to generate the form.
6. If using the new Elective Payment option use the new Elective Payment fields.
   • If filing an elective payment on the Form 3800 the IRS requires a registration number that you must complete before filing the tax return. See here for more information.
   • The 3800 will only generate for S Corporation if an Elective Payment or Transfer is used.