Maryland’s excise tax credit for electric vehicles is still on the books, but the money behind it is gone for the year. If you buy a Tesla Model 3 or Model Y in Maryland right now, you can still apply for the credit. You just will not get paid anytime soon, if at all.
The credit itself is not new. Maryland’s excise tax credit for plug-in electric and fuel cell vehicles pays up to $3,000 toward the one-time excise tax you owe when you title a vehicle in the state. To qualify, the vehicle’s total purchase price cannot exceed $50,000, it needs a battery of at least 4 kilowatt-hours, and it has to be titled for the first time between July 1, 2023 and July 1, 2027. Both Tesla models you are likely considering clear the price cap: the Model 3 Standard starts at $38,630 including destination, and the Model Y Standard starts at $41,630. A heavily optioned car that pushes past $50,000 would not qualify.
The catch is funding. In an official dealer bulletin, the Maryland Motor Vehicle Administration (MVA) states that fiscal year 2026 funding for the credit is depleted, as of that bulletin’s most recent posting in January 2026. The state sets aside up to $8.25 million a year for the program, and it pays out first come, first served. Once that pool runs dry, new applicants go on a waiting list instead of being turned away outright.
If you buy and title your Tesla now, the MVA will still accept your paperwork and place you on the fiscal year 2027 waiting list. Dealers are required to tell you, before you sign, that you may not receive the credit, and that even if next year’s budget funds the program, payment would not happen before July 1, 2026 at the earliest. There is no guaranteed date for when, or whether, waitlisted applicants actually get paid. Each individual is limited to one vehicle and each business to ten.
This state credit was always a secondary incentive next to the federal one, and the federal credit is gone entirely now. The IRS confirms that the New Clean Vehicle Credit, worth up to $7,500, does not apply to any vehicle acquired after September 30, 2025, following a 2025 change in federal law. So a Maryland buyer today is stacking two gaps: no federal credit at all, and a state credit that exists on paper but has no cash behind it until lawmakers add more.
What this means for your budget: price your Tesla purchase in Maryland as if the $3,000 state credit does not exist. If you eventually get paid, treat it as a bonus rather than money you planned around. Applying costs you nothing and holds your place in line if the state adds funding later, so there is little reason to skip the paperwork. Just do not delay a purchase decision while you wait on it.
To apply, your dealer submits a completed VR-334 form along with your window sticker, bill of sale, and Manufacturer’s Certificate of Origin to the MVA. This article is informational only and not tax or financial advice; confirm current funding status and eligibility directly with the Maryland MVA before you buy.
Photo by 04iraq.
