Texas just made buying an electric car a little sweeter. To help offset the recent loss of the federal new EV tax credit for some models, the state has launched fresh grants under its Light-Duty Motor Vehicle Purchase or Lease Incentive Program (LDPLIP). That means buyers of popular electric vehicles like the Tesla Model Y can snag up to $2,500 back, and certain alternative-fuel vehicles can qualify for even more.
What the Texas EV incentive offers
– Up to $2,500 for eligible new electric vehicles such as the Tesla Model Y
– Up to $5,000 for vehicles powered by LPG or CNG
– Applies to light-duty vehicles with a gross vehicle weight rating of 10,000 pounds or less, including plug-in hybrids, EVs, LPG, CNG, and hydrogen vehicles
Who qualifies and when
– Individuals and organizations that purchased or leased an eligible vehicle on or after September 1, 2025
– You must apply after the vehicle is delivered and after you have applied for, or obtained, a Texas title and registration
– Applications opened October 13 and are accepted on a first-come, first-served basis until 5 PM in March 2026 or until funding runs out
– Even if you took delivery in September and received a federal tax credit, you can still apply for the Texas grant
How much you can get for a lease
– 36 months or longer: 100% of the $2,500 EV grant
– 24 months: 66% of the grant ($1,665)
– Less than 24 months: 33% of the grant ($832.50)
Documents you’ll need to apply
– Completed and signed IRS Form W-9
– Texas title and registration, or application receipts for both
– A completed and executed purchase or lease agreement signed by both the buyer/lessee and the seller
– Proof of purchase or financing, such as:
– Buyer’s order with a canceled check or a bank statement showing payment in full, or
– A finance agreement or retail installment contract signed by both the applicant and the lender
– For individual applicants: a Texas state ID, such as a driver’s license
Why this matters for Tesla Model Y shoppers
– The $2,500 Texas grant directly reduces your overall cost, making ownership more affordable
– If you lease, you can still capture a meaningful portion of the incentive based on term length
– Buyers who recently took delivery aren’t excluded as long as the purchase or lease was on or after September 1, 2025 and the vehicle is titled and registered in Texas
Tips to maximize your savings
– Opt for a 36-month lease or buy outright to get the full $2,500 on eligible EVs
– Gather all documents before applying to avoid delays; funds are limited and awarded first-come, first-served
– Submit your application as soon as your vehicle is delivered and your title/registration are in process or completed
Bottom line
Texas is putting real money on the table for electric and alternative-fuel vehicles. If you’re considering a Tesla Model Y or another qualifying light-duty vehicle, act quickly. With up to $2,500 for EVs and up to $5,000 for LPG or CNG models, this limited-time program can significantly lower your cost of ownership—especially if you lock it in before the funds run out.
