EV Lease vs Buy Calculator
Compare monthly payments, total cost, and break-even timelines for any electric vehicle. Includes the $7,500 federal tax credit and real lease money factors from manufacturer programs.
Lease vs Buy: Common Questions
Should I lease or buy an electric vehicle?
It depends on your situation. Leasing typically offers lower monthly payments and allows you to upgrade to a newer EV every 2–3 years as technology improves. Buying builds equity and can be cheaper long-term if you keep the vehicle 5+ years. Our calculator shows exactly when buying becomes cheaper (break-even month).
How does the $7,500 federal tax credit work for leasing?
When you lease an EV, the dealer (as the commercial buyer) claims the IRS §45W Commercial Clean Vehicle Credit and typically passes the full $7,500 as a capital cost reduction — lowering your monthly payment. There is no income limit on you as the lessee. When you purchase, the §30D New Clean Vehicle Credit is income-limited: $150,000 single / $300,000 married filing jointly.
What is a money factor in a lease?
The money factor is the lease equivalent of an interest rate. Multiply it by 2,400 to get the approximate APR. For example, a money factor of 0.00125 = 3% APR. Lower is better. Money factors are set by the manufacturer's captive finance arm and change monthly.
What is residual value in a lease?
The residual value is what the leasing company projects the car will be worth at the end of your lease term, expressed as a percentage of MSRP. A higher residual means lower monthly payments because you're financing less depreciation. EVs typically have residuals between 45–60% for 36-month leases.
Can I negotiate a lease price?
Yes — the capitalized cost (equivalent of the selling price) is negotiable. You cannot typically negotiate the money factor or residual value set by the manufacturer's finance arm, but dealers may offer additional discounts. Always negotiate the selling price, not just the monthly payment.