Richard Masoner

Taxpayers are on the hook for up to $900 of the purchase of an electric bicycle in Democrats’ most recent version of their reckless tax and spending spree.

According to the text of the bill, Section 136407 would create a new 30% refundable tax credit for electric bicycles purchased before January 1, 2026. The bill allows up to $3,000 of the cost of an “e-bike” to be taken into account for the credit, creating a maximum allowable credit of $900 for individuals. E-bikes costing as much as $4,000 would be eligible for the credit.

Could send up to $7,200 to e-bike owners before provision expires

The credit begins phasing out for joint filers earning $150,000 ($75,000 for individuals) at a rate of $200 per $1,000 of additional income. Filers would be allowed to claim 1 credit per year (2 per year for joint filers) meaning taxpayers would potentially subsidize multiple e-bikes purchased by the same filer year after year. The bill would allow for a married couple earning $150,000 to purchase two new electric bicycles every year and claim up to $7,200 in e-bike credits before the provision expires in 2026.   

Ignores Ways and Means amendment cutting credit to 15%

While the original draft of the reconciliation package included a 30% e-bike credit, the Ways and Means committee amended the bill during mark-up to limit the credit to 15% and a maximum credit of $750. The latest version of the ignores amendments that passed in committee with Democrat support and instead increases the credit to 30% capped at $900.

Democrats want e-bikes to replace cars

Democrats’ e-bike tax credit is modeled off of legislation introduced earlier this year by Rep. Jimmy Panetta (D-California) and Rep. Earl Blumenauer (D-Oregon). In a press release accompanying the rollout of the legislation, Rep. Panetta stated the purpose of the e-bike credit was to “transition to greener modes of transportation” by “incentivizing the use of electric bicycles to replace car trips.”