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Advancements in cars and their technology these days not only try to focus on cleaner alternatives for the environment, but they also make different types of green cars to help you get the best mileage. Not only are they priced pretty reasonably compared to standard cars, but you can also get a federal and state tax credit.

There are 5 different types of green cars:

  1. Eco-friendly
  2. Diesel
  3. Hybrid
  4. Plug-in Hybrid
  5. Electronic

Different Types of Green Cars

With growing popularity with green and fuel-efficient cars has put many different vehicles on the market – so much that they have different types of green cars.

Eco-Friendly

More standard cars are now equipped with “green driving”, which usually includes features that help improve the gas mileage. Some engine characteristics have changed to guzzle down less fuel. Some believe the green mode can make the driving experience duller, but it gives you a more miles to the gallon. One example of an eco-feature is the engine turning off when stopped instead of idling. Some examples of eco-friendly cars:

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  • Toyota Yaris – $15,950, 32/40/35 city/hwy/combo
  • Hyundai Elantra Eco – $20,500, 32/40/35 city/hwy/combo
  • Honda Civic $18,840, 32/42/36 city/hwy/combo
  • Honda Fit $16,190, 33/40/36 city/hwy/combo
  • Toyota Prius Eco – $25,165, 58/53/56 city/hwy/combo

Diesel

It may be shocking, but cars are also now being made with turbo-diesel engine. It can be a good option for fuel efficiency because the tech is proven, and diesel fuel is just as easy to find as regular. The fuel usage is also more efficient than for gas engines. Manufacturers are also making the latest diesel engine to be quieter and more reliable. Diesel cars that are fuel efficient are:

  • Jaguar XE 20d – $35,725, 32/42/36 city/hwy/combo
  • Chevrolet Cruze Diesel – $23,795, 30/52/37 city/hwy/combo
  • Chevrolet Equinox Diesel – $30,700, 28/39 city/hwy
  • BMW 540d xDrive $62,000, 26/36 city/hwy
  • Jaguar FPace 20d R-Sport – $55,675, 26/33 city/hwy

Hybrid

Hybrid cars run on both gasoline and electricity, but they don’t need to be plugged in because the gas recharges the battery as it runs. They are the cars that use the most gas and least electricity when it comes to any green cars that use any electricity. Some hybrid cars are:

  • Toyota Avalon Hybrid – $37,500, 40/39/40 city/hwy/combo
  • Lincoln MKZ Hybrid $35,445, 41/38/40 city/hwy/combo
  • Ford C-Max Hybrid $24,120, 42/38/40 city/hwy/combo
  • Kia Optima Hybrid – $25,995, 39/46/42 city/hwy/combo
  • Hyundai Sonata SE Hybrid – $26,000, 40/46/42 city/hwy/combo

Plug-In Hybrid

Plug-in hybrids are similar to hybrids except they use gas and batteries that can be recharged using electricity. It runs on both the gas and electricity, so if you can’t find a place to charge it or you forget to charge it you can fill it with gas. Different plug-in hybrid cars include:

  • Kia Optima PHEV $35,210, 103 e/40 combo
  • Kia Nero PHEV – $27,900, 105 e/46 combo
  • Chevrolet Volt – $33,220, 106 e/42 combo
  • Honda Clarity PHEV – $33,400, 110 e/42 combo
  • Hyundai Ioniq PHEV – $24,950, 119 e/52 combo

Electric

These cars are run exclusively on electricity that’s stored in their batteries. The batteries typically need to be charged daily or more, depending on how much you use your car as well as the size of the vehicle. There are probably a few electric vehicles that come to mind when you think about electric cars, but some common ones are:

  • Tesla Model 3 – $35,000, 310 e-mpg
  • Chevrolet Bolt EV – $37,495, 238 e-mpg
  • Nissan Leaf – $29,990, 150 e-mpg
  • BMW i3 – $44,450, 118 e-mpg
  • Kia Soul EV – $32,350, 93 e-mpg

How Getting an Electric Car Tax Credit Works

The federal electric car tax credit is available for certain electric and plug-in vehicles, and the maximum amount available on any of the vehicles is based on the capacity of its battery pack. You can find the full list of tax credits for cars at the US Department of Energy’s Fuel Economy’s website.

The tax credit is only available in the year that you put the car in service, so you can’t carry the credit from year-to-year you own the car. It will only pay for any federal tax you owe, so if you are only required to pay a certain amount for the year you purchased the car, you can only take that amount of credit. If you have doubts about the credit advantage, contact your tax professional to discuss. You may also be able to claim as much as 30% of the cost of your home charger for your vehicle (if you needed one installed).

Keep in mind that the electric car tax incentive program is set to phase out for each car manufacturer after they sell 200,000 of that specific electric/plug-in model. Two quarters after the manufacturer hits the 200,000 units, the tax credit available to customers cuts in half. Two quarters after that, it is cut 25%.