The One Big Beautiful Bill Act has many moving parts. While some changes are effective starting in 2025 others don’t take effect until 2026. Incentives for buying equipment apply for 2025. Some changes related to your staff also apply for 2025. But some tax breaks are ending in 2025 or 2026, and you must act quickly if you want to take advantage of them before they disappear.
EVs and charging stations
Thinking of buying a plug-in electric vehicle? If you want to take advantage of a federal tax credit for the purchase, assuming you qualify, you better act fast. Three tax credits are set to expire on September 30, 2025:
- New clean vehicle credit up to $7,500
- Previously-owned clean vehicle credit up to $4,000
- Commercial clean vehicle credit up to $7,500 for vehicles weighing less than 14,000 pounds; $40,000 for vehicles weighing 14,000 pounds or more
Determine whether you qualify for an EV credit by reviewing IRS FAQs on these credits.
Charging stations. If you have an EV, you probably need a charging station. The alternative fuel vehicle refueling property credit provides help to pay for the cost of installing one.
- For individuals who install a charging station at a residence: 30% of the cost of charger plus installation up to $1,000 per port (assuming it is in a rural or low-income community)
- For businesses: 30% of the cost up to $100,000 (assuming it is in a rural or low-income community and prevailing wage and apprenticeship requirements are met)
The credits apply only to charging stations installed by June 30, 2026. Again, if you want to have one and take advantage of the credit, it must actually be installed, and not just purchased, by that date.
Note: State-level tax incentives for buying EVs may still be available. Check your location through DSIRE, a database of state incentives for renewables & efficiency.
Work opportunity credit
The work opportunity credit was created in the Small Business Job Protection Act of 1996 to incentivize employers to hire individuals from certain targeted groups, such as ex-felons, certain veterans, and summer youth. The federal credit was initially given a limited life, but was extended numerous times. Extensions have run out and the credit is set to expire on December 31, 2025.
The basic credit is 40% of first-year wages up to $6,000 ($2,400 per employee from a targeted group), but the credit can be as much as $9,600 for hiring certain veterans and as low as $1,200 for summer youth. The credit will apply to employees who begin work by December 31, 2025. If you hire individuals that could entitle the business to the credit, be sure to submit IRS Form 8850 to the state workforce agency within 28 days of hiring. Without this step, a legitimate credit can be lost.
Alert: It is possible Congress could enact a last-minute extension.
Home builders
If you are a contractor who builds energy-efficient homes, you may be able to claim a federal tax credit of up to $2,500 per single-family home, $2,400 per manufactured home, and $500 per unit for a multi-family home. The credit amounts are higher credits when meeting prevailing wage standards. The credit is available only for qualified homes purchased by homeowners on or before June 30, 2026.
Because it takes time to plan, build, and sell homes, contractors that could benefit from the tax credit need to act quickly. Find more information about this federal tax credit from the IRS (as yet the website has not been updated to reflect the new expiration date).
Energy-efficient commercial buildings
If energy-upgrades are made to commercial buildings, the cost of the project can be deducted: up to $1.16 per square foot for projects meeting a 25% energy savings, and up to $5.81 per square foot with similar energy savings but meeting prevailing wage and apprenticeship requirements during the project. This deduction ends for projects whose construction begins after June 30, 2026. If projects are begun by this date, the deduction can still be claimed even if the property is placed in service after this date.
Again, because it takes time to plan, obtain permits, and begin energy upgrades, time is of the essence. Find more information about this federal tax deduction from the IRS.
Other green energy tax breaks
A number of green energy tax credits are scheduled to expire soon. For example, the clean energy investment credit for solar, wind, fuel cell, etc. applies only if construction of the projects begins by July 4, 2026, and is placed in service by December 31, 2027.
Final thought
“You may delay, but time will not.” ― Benjamin Franklin
The clock is ticking. Be sure to discuss your situation with your CPA or other tax adviser so you can plot out actions to be taken quickly in order to secure expiring tax breaks before it’s too late.
