MINNEAPOLIS — According to the Minnesota Department of Revenue, 100,000 electric-assisted bicycles were sold in 2020. Two thousand of those were sold in Minnesota alone that year.
With approximately $4 million set aside through the transportation omnibus bill, Minnesotans will be able to claim up to 75% of the price of the e-bike — or up to $1,500 — very soon.
It's no secret that e-bikes currently come with some sticker shock.
"E-bikes at this point tend to be more expensive with any new sort of new-ish technological things," Hub Bike Co-Op marketing coordinator Barthollomew Presby said.
Despite the prices of e-bikes ranging from $1,900 to around $5,000 at The Hub, even Presby said they can't deny the piquing interest that customers have shown in the past few months.
"We have a couple of cargo e-bikes over there, which are really great for just carrying anything from all of your groceries for a week to your kids to school," they explained. "We've had some customers set them up with child seats and all that, which is really nice. Or, I've had a lot of people who have been biking their whole lives actually, and are coming to a point where their knees are going bad; they want to be more upright, they don't want to be sweating on their way to work."
The needs that lead to an e-bike purchase vary, and with the tax credit, Presby said an e-bike, especially ones on the cheaper end of the spectrum, become more in reach.
"At the more entry-level e-bikes, it will be probably a no-brainer," Presby said. "Especially if people have been thinking about it for a while."
And there's no time like now. Presby said e-bikes have been around just long enough that some are entering the secondhand market.
"What used to be totally inaccessible is coming down," Presby said. "We're seeing e-bikes in our used section. With that, I can see in a couple of years, prices on really great quality bikes dropping and dropping."
Preby said they're excited to see this boost from the state accelerate popularity, hopefully enough to get new folks hopping on bikes in general.
"We're starting to see a lot more people get into cycling who probably would never have had any contact with it before which is super cool," Presby said.
To claim the credit, a taxpayer must apply to the commissioner of revenue for a credit certificate before going to an authorized retailer. That certificate must be used within three months of issuance.
There's no word yet on when the credits will start being issued. The commissioner of revenue will decide when applications open. However, the $4 million was set aside to be applied towards the 2024 and 2025 calendar years.
In terms of income, the Department of Revenue said:
"The bill creates a credit available to resident income taxpayers equal to 75% of the amount paid for an electric-assisted bicycle. The credit is limited to a maximum amount of $1,500.
For married taxpayer filing a joint return, the limit is $1,500 per spouse. The credit percentage is reduced by one percentage point for each $4,000 of adjusted gross income in excess of $50,000 for married taxpayers filing a joint return ($25,000 for all other taxpayers) until the credit percentage equals 50%.
The commissioner can not more than $2 million in credits each year, and no credits can be allocated starting tax year 2026. Additionally, 40% of credits must be reserved for married joint filers with an adjusted gross income less than $78,000 or any other filer with an adjusted gross income of less than $41,000."
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