SEC. 136402. CREDIT FOR PREVIOUSLY-OWNED QUALIFIED PLUG-IN ELECTRIC DRIVE MOTOR VEHICLES. (a) In General.--Subpart C of part IV of subchapter A of chapter 1, as amended by the preceding provisions of this Act, is amended by inserting after section 36C the following new section: ``SEC. 36D. PREVIOUSLY-OWNED QUALIFIED PLUG-IN ELECTRIC DRIVE MOTOR VEHICLES. ``(a) Allowance of Credit.--In the case of a qualified buyer who during a taxable year places in service a previously-owned qualified plug-in electric drive motor vehicle, there shall be allowed as a credit against the tax imposed by this subtitle for the taxable year an amount equal to the sum of-- ``(1) $1,250, plus ``(2) in the case of a vehicle which draws propulsion energy from a battery which exceeds 4 kilowatt hours of capacity (determined at the time of sale), the lesser of-- ``(A) $1,250, and ``(B) the product of $208.50 and such excess kilowatt hours. ``(b) Limitations.-- ``(1) Sale price.--The credit allowed under subsection (a) with respect to sale of a vehicle shall not exceed 30 percent of the sale price. ``(2) Adjusted gross income.--The amount which would (but for this paragraph) be allowed as a credit under subsection (a) shall be reduced (but not below zero) by $200 for each $1,000 (or fraction thereof) by which the taxpayer's adjusted gross income exceeds-- ``(A) $150,000 in the case of a joint return or a surviving spouse (as defined in section 2(a)), ``(B) $112,500 in the case of a head of household (as defined in section 2(b)), and ``(C) $75,000 in the case of a taxpayer not described in paragraph (1) or (2). ``(c) Definitions.--For purposes of this section-- ``(1) Previously-owned qualified plug-in electric drive motor vehicle.--The term `previously-owned qualified plug-in electric drive motor vehicle' means, with respect to a taxpayer, a motor vehicle-- ``(A) the model year of which is at least 2 earlier than the calendar year in which the taxpayer acquires such vehicle, ``(B) the original use of which commences with a person other than the taxpayer, ``(C) which is acquired by the taxpayer in a qualified sale, ``(D) registered by the taxpayer for operation in a State or possession of the United States, and ``(E) which meets the requirements of subparagraphs (C), (D), (E), (F), and (G) of section 36C(e)(1). ``(2) Qualified sale.--The term `qualified sale' means a sale of a motor vehicle-- ``(A) by a seller who holds such vehicle in inventory (within the meaning of section 471) for sale or lease, ``(B) for a sale price not to exceed $25,000, and ``(C) which is the first transfer since the date of the enactment of this section to a person other than the person with whom the original use of such vehicle commenced. ``(3) Qualified buyer.--The term `qualified buyer' means, with respect to a sale of a motor vehicle, a taxpayer-- ``(A) who is an individual, ``(B) who purchases such vehicle for use and not for resale, ``(C) with respect to whom no deduction is allowable with respect to another taxpayer under section 151, ``(D) who has not been allowed a credit under this section for any sale during the 3-year period ending on the date of the sale of such vehicle, and ``(E) who possesses a certificate issued by the seller that certifies-- ``(i) that the vehicle is a previously- owned qualified plug-in electric drive motor vehicle, ``(ii) the vehicle identification number of such vehicle, ``(iii) the capacity of the battery at time of sale, and ``(iv) such other information as the Secretary may require. ``(4) Motor vehicle; capacity.--The terms `motor vehicle' and `capacity' have the meaning given such terms in paragraphs (2) and (4) of section 36C(e), respectively. ``(d) VIN Number Requirement.--No credit shall be allowed under subsection (a) with respect to any vehicle unless the taxpayer includes the vehicle identification number of such vehicle on the return of tax for the taxable year. ``(e) Application of Certain Rules.--For purposes of this section, rules similar to the rules of paragraphs (1), (2), (4), (5), (6) and (7) of section 36C(f) shall apply for purposes of this section. ``(f) Certificate Submission Requirement.--The Secretary may require that the issuer of the certificate described in subsection (c)(3)(E) submit such certificate to the Secretary at the time and in the manner required by the Secretary. ``(g) Treatment of Certain Possessions.-- ``(1) Payments to possessions with mirror code tax systems.--The Secretary shall pay to each possession of the United States which has a mirror code tax system amounts equal to the loss (if any) to that possession by reason of the application of the provisions of this section. Such amounts shall be determined by the Secretary based on information provided by the government of the respective possession. ``(2) Payments to other possessions.--The Secretary shall pay to each possession of the United States which does not have a mirror code tax system amounts estimated by the Secretary as being equal to the aggregate benefits (if any) that would have been provided to residents of such possession by reason of the provisions of this section if a mirror code tax system had been in effect in such possession. The preceding sentence shall not apply unless the respective possession has a plan which has been approved by the Secretary under which such possession will promptly distribute such payments to its residents. ``(3) Mirror code tax system; treatment of payments.--Rules similar to the rules of paragraphs (4) and (5) of section 21(h) shall apply for purposes of this section. ``(h) Termination.--No credit shall be allowed under this section with respect to any vehicle acquired after December 31, 2031.''. (b) Conforming Amendments.-- (1) Section 6211(b)(4)(A), as amended by the preceding provisions of this Act, is amended by inserting ``36D,'' after ``36C,''. (2) Section 6213(g)(2), as amended by the preceding provisions of this Act, is amended-- (A) in subparagraph (S), by striking ``and'' at the end, (B) in subparagraph (T), by striking the period at the end and inserting ``, and'', and (C) by adding at the end the following: ``(U) an omission of a correct vehicle identification number required under section 36D(d) (relating to credit for previously-owned qualified plug-in electric drive motor vehicles) to be included on a return.''. (3) Paragraph (2) of section 1324(b) of title 31, United States Code, as amended by the preceding provisions of this Act, is amended by inserting ``36D,'' after ``36C,''. (c) Clerical Amendment.--The table of sections for subpart C of part IV of subchapter A of chapter 1, as amended by the preceding provisions of this Act, is amended by inserting after the item relating to section 36C the following new item: ``Sec. 36D. Previously-owned qualified plug-in electric drive motor vehicles.''. (d) Effective Date.--The amendments made by this section shall apply to vehicles acquired after December 31, 2021.