Non-refundable credits are credits that can decrease your tax liability to zero, but not lower than that amount. Any left over credit is forfeited.
In contrast, refundable credits are credits that can reduce your tax liability to "below zero". i.e., one can still get the excess credit refunded even after it reduces one's tax liability to zero. Is America great or what!
Non-refundable credits are reported on the new Schedule 3, which requires Deluxe or higher.
