On a $36,495 electric car, our arithmetic puts a 36-month lease at about $507 a month, or $21,244 in total with $3,000 down. Buying the same car with a 60-month loan at 6.5% costs $655 a month, and once you sell it at the end of year three your net cost lands between $20,138 and $24,518, depending on whether the car keeps 58% or 46% of its price. Leasing wins if the car depreciates like a typical fast-falling EV; buying wins only if it holds its value, or if you can get a promotional loan rate. The federal credits that used to tilt this decision are gone.
What Changed When the Credits Ended
The IRS says the New Clean Vehicle Credit is not available for vehicles acquired after September 30, 2025, and that the Commercial Clean Vehicle Credit also stops for vehicles acquired after that date. A car placed in service later can still qualify only if you had a binding written contract and made a payment on or before September 30, 2025 (IRS, New Clean Vehicle Credit; IRS, Commercial Clean Vehicle Credit). We are quoting those pages, not advising on your taxes; a tax professional can say whether anything applies to you.
The market has moved since. Cox Automotive’s Q1 2026 data, as reported by Electrek on March 27, 2026, showed that new EV sales fell 28% year over year to 212,600 in Q1, that new EV inventory stood at 130 days of supply against 89 for gas vehicles, and Cox forecasts full-year 2026 lease penetration falling to 22%, down 2 points. Cox describes the 2023-2025 wave of leases as having used the IRA “leasing loophole,” and expects lease returns to climb to about 240,000 units a month, roughly 20% of them electric, which should add used-EV supply.
Electrek’s 2026 tracking of one popular lease shows how fast a deal can move:
| Chevrolet Equinox EV LT1, 39-month lease | April 2026 | June 2026 |
|---|---|---|
| Monthly payment | $269 | $554 |
| Due at signing | $3,659 | $3,659 |
| Effective monthly cost (due at signing spread over term) | about $362 | about $648 (our arithmetic) |
| Customer incentive | $10,000 discount | $1,000 cash on select trims, not the LT1 |
| Finance offer | 0% for 60 months | 2.9% for 36 months |
Source: Electrek, June 12, 2026, citing Chevy’s calculator; mileage allowance was not stated. These are advertised offers that change monthly, so treat them as a snapshot, not a quote.
How a Lease Payment Is Built
The Federal Reserve’s leasing FAQ explains that the base monthly payment covers depreciation (the drop from capitalized cost to the residual value), plus a rent charge that works like interest, and that most lessors express it as a money factor. In the standard formulas:
- Depreciation per month = (capitalized cost − residual) ÷ months
- Rent charge per month = (capitalized cost + residual) × money factor
- Money factor × 2,400 is roughly the APR
Our example inputs, all assumptions except the price:
| Input | Value |
|---|---|
| Price (2026 Equinox EV LT1 FWD MSRP including destination, per Electrek) | $36,495 |
| Down payment (capitalized cost reduction) | $3,000 |
| Residual value after 36 months | 55% = $20,072 (assumed) |
| Money factor | 0.0025, about 6.0% APR (assumed) |
| Taxes, fees, insurance | Left out of both sides |
Depreciation is ($33,495 − $20,072) ÷ 36 = $372.85. The rent charge is ($33,495 + $20,072) × 0.0025 = $133.92. The payment is about $507, and 36 payments plus $3,000 down total $21,244, or about $590 a month all in (our arithmetic). The residual matters most: at 52% the payment rises to $534, and each step of 0.0010 in the money factor moves it about $54 a month, so a 0.0015 factor gives $453 and a 0.0035 factor gives $560.
Buying the Same Car
Financing $33,495 at 6.5% over 60 months is a payment of $655.37 (standard loan formula; the amount, APR and term are our assumptions). After 36 payments you have paid $23,593 plus the $3,000 down, still owe about $14,712, and have paid about $4,810 in interest. Your three-year cost depends on what the car is worth when you sell:
| Scenario | Value kept after 3 years | Net 3-year cost | Per month |
|---|---|---|---|
| Buy, 6.5% loan | 46% | $24,518 | $681 |
| Buy, 6.5% loan | 55% | $21,233 | $590 |
| Buy, 6.5% loan | 58% | $20,138 | $559 |
| Buy, 2.9% loan | 46% | $21,808 | $606 |
| Buy, 2.9% loan | 58% | $17,429 | $484 |
| Lease (above) | not applicable | $21,244 | $590 |
Net cost is down payment plus 36 loan payments minus (resale value − loan balance). One real data point for the resale side: Kelley Blue Book data reported by Jalopnik on August 25, 2026 put a three-year-old 2023 Toyota bZ4X at 52% to 54% below its original price, meaning it kept about 46% to 48%. That is one model, not an EV average, and values differ by trim and condition.
The pattern is mechanical. At a market-rate loan, buying ties the lease at almost exactly the residual we assumed, 55%, because the lessor’s rent charge and your loan interest are priced similarly. If the car is worth less, you absorb the shortfall; if it is worth more, you keep it. At a 2.9% promotional loan the break-even falls to about 47.5% (our arithmetic), which is why financing deals can make buying competitive even for fast-depreciating models.
Mileage Limits
The Federal Reserve’s FAQ notes most leases cap annual miles, often at 12,000 or 15,000, and that a higher cap raises the monthly payment while sometimes costing less than paying excess-mile charges later. The cap exists because the residual assumes a certain mileage; excess charges are how the lessor recovers the extra drop in value. Early termination can cost up to several thousand dollars, and the sooner you exit, the more you pay.
Our illustration, using an assumed rate (your contract states the real one): a 10,000-mile cap over 36 months allows 30,000 miles. If you drive 13,000 a year, you are 9,000 miles over, and at an assumed $0.25 a mile that is $2,250 at turn-in. Buyers pay no such charge but sell a lower-value car.
Who Should Lease and Who Should Buy
Leasing tends to fit if you drive under the cap, want a fixed three-year cost, would rather not carry resale risk while EV values are moving, and plan to switch cars in three years. It also fits if you want to see whether home charging works for you; our home EV charger installation cost guide covers that expense, which a lease does not remove.
Buying tends to fit if you drive more than 15,000 miles a year, plan to keep the car six years or longer, can get a low promotional APR, or buy used. Cox’s Q1 2026 data put the average used EV at $34,821, and the new-EV average transaction price at $55,300 in February, so a used purchase skips much of the first-owner depreciation. For either option, obtain insurance quotes for the actual vehicle and include them in the same ownership period.
FAQ
Can I still get a federal tax credit by leasing an EV in 2026?
The IRS says the credit is unavailable for vehicles acquired after September 30, 2025, with an exception only where a binding written contract and payment existed by that date. It makes the same statement for the commercial credit. For your situation, ask a tax professional.
Why are EV lease payments higher than they were?
Electrek’s Equinox EV example shows a base trim going from $269 to $554 a month between April and June 2026 as a $10,000 discount shrank to a $1,000 cash allowance. Cox says automakers are adding incentives to clear 130 days of EV inventory, so deals still appear, but they shift month to month.
What money factor should I look for?
Multiply the money factor by 2,400 to approximate an APR. In our example, 0.0015 gives a $453 payment and 0.0035 gives $560 at the same 55% residual. Ask the dealer for the money factor and residual in writing, and compare it to a loan rate.
What happens if I go over the mileage limit?
You owe the per-mile rate in your contract, and the Federal Reserve notes the cap is tied to the residual value. At an assumed $0.25 a mile, 9,000 extra miles costs $2,250 (our arithmetic).
Bottom Line
With the credits gone, leasing an EV no longer comes with a built-in subsidy, and the decision is about resale risk and mileage. In our model a 36-month lease on a $36,495 EV costs $21,244, and buying beats it only if the car holds roughly 55% of its price on a market-rate loan, or 47.5% on a 2.9% loan. Get the money factor, residual, and mileage cap in writing, then run your own numbers.