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New Member
posted Feb 7, 2024 1:08:11 PM

Why does my solar panel credit keep rolling over? It’s rolled over for 2 years now.

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1 Best answer
Level 15
Feb 7, 2024 1:51:37 PM

i.e. you need a final tax liability to offset.   If your only income is wiped out by itemized or the Standard Deduction, that may result in zero "Taxable" income....and a zero tax liability.

 

If this is expected to continue in the future, and you have a traditional IRA, you could covert some of the IRA to a ROTH IRA to create some more "taxable" income...and then the credit can be used next year.  But how much to convert would take careful planning and perhaps a local financial advisor.

2 Replies
Level 15
Feb 7, 2024 1:15:48 PM

By federal law, if you can't use all of the credit in one year because you've offset your tax liability for that year, the unused portion has to be carried forward to the next tax year.

 

 

Level 15
Feb 7, 2024 1:51:37 PM

i.e. you need a final tax liability to offset.   If your only income is wiped out by itemized or the Standard Deduction, that may result in zero "Taxable" income....and a zero tax liability.

 

If this is expected to continue in the future, and you have a traditional IRA, you could covert some of the IRA to a ROTH IRA to create some more "taxable" income...and then the credit can be used next year.  But how much to convert would take careful planning and perhaps a local financial advisor.