The Build Back Better Act, which includes funding for COVID-19 relief, social services, welfare, and infrastructure, as well as funds allocated towards reducing the effects of climate change, also includes e bike tax credits.
The bill totals $1.75 trillion with $7.4 billion directed towards e bike tax credits. The ‘E-BIKE ACT’, a 30% tax credit for an electric bike over five years, would provide a rebate for those looking for a greener alternative to their current transport. The E-BIKE ACT would further include a $81 a month pre-tax benefit for biking to work. This credit can be applied to the purchase of a new electric bike (the first $5000) up to a maximum $750 value.
One claim can be made per taxable year per e bike, two for joint filters, starting in 2022. The credit would be phased out beginning at $75,000 of modified adjusted gross income ($112,500 for heads of household and $150,000 for joint marriage filing) at a rate of $200 per $1,000 of additional income.
This bill has been passed in the house but needs to pass through the Senate to be implemented.