Where on TurboTax do we file Federal Heat Pump tax credit?

[DoninGA]

@Criddle26 

The Form 5695 for tax year 2023 was updated today, 02/08.  If using the desktop editions make sure you update your software.

The heat pump is entered on the screen labeled  Enter Your Qualified Energy Costs in the box labeled Heat Pumps

[Criddle26]

The form only shows the geothermal heat pump

[DoninGA]

@Criddle26 You Must go past that screen until you land on the screen -  Enter Your Qualified Energy Costs

Enter your cost for the type of heat pump that was installed.

[daisyismad]

Has this been resolved? When I started my taxes, it gave me the $2,000 deduction for the electric heat pump. Now that I've logged back in, the credit caps at $500. As far as I can tell, I should be getting the full $2,000 credit.

[JohnW152]

Yes, this has been resolved. You might want to re-trace your steps in TurboTax Online:

1. Open TurboTax Online
2. Select Tax Home in the left pane
3. On the Hi, let's keep working on your taxes! screen, select the dropdown on the right side of the Deductions & Credits box, then select Start, Continue, or Review/Edit
4. On the Your tax breaks page, select the dropdown to the right of Your Home, then select Start or Revisit to the right of Home Energy Credits
5. On the Energy-Saving Home Improvements screen, select Yes, then Continue
6. Proceed through the screens.  Don't enter anything on the Enter Any Residential Clean Energy Improvements screen, just select Continue
7. Continue through the screens until you get to the Did you have any residential energy property costs in 2023? page.  Select Yes, then Continue
8. Answer appropriately on the Tell Us More About the Residential Energy Property screen, then select Continue
9. On the Enter your qualified energy property costs screen, enter your heat pump costs in the box to the right of Heat pumps (electric or natural gas), then select Continue
10. Enter any requested information on the following screens

See the Instructions for Form 5695 for information. 

[daisyismad]

I've done this, but it still maxes the refund at $500 now, instead of the $2,000 it had given me two weeks ago. I'm on the desktop version (Premier 2023). Does this make a difference?

[DoninGA]

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@daisyismad wrote:

I've done this, but it still maxes the refund at $500 now, instead of the $2,000 it had given me two weeks ago. I'm on the desktop version (Premier 2023). Does this make a difference?

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What is the cost of the Heat Pump you entered?  The credit is 30% of your cost but the maximum credit is $2,000

[daisyismad]

The heat pump cost $26,802.27.

[daisyismad]

I have two boxes, "amount you paid" and "total paid". I just figured out if I delete the total paid and try to continue, it gives me the correct $2,000 refund, but also gives me an error where I cannot continue because "The amount you paid can't be greater than the total amount paid". Is this a software glitch?

[DoninGA]

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@daisyismad wrote:

I have two boxes, "amount you paid" and "total paid". I just figured out if I delete the total paid and try to continue, it gives me the correct $2,000 refund, but also gives me an error where I cannot continue because "The amount you paid can't be greater than the total amount paid". Is this a software glitch?

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Those boxes you mentioned are not in the TurboTax program for the Home Energy Credit, nor on the Form 5695.

Have you updated your desktop software to the latest release?

Click on Online at the top of the desktop program screen.  Click on Check for Updates.

This is the screen you should have for entering the Heat Pump cost

On the Form 5695 your cost is shown on Line 29b with the credit on Line 30.  The smaller of Line 30 or Line 31 is entered on Line 32.  The amount of credit you are eligible to receive flows from From 5695 Line 32 to Schedule 3 Line 5b.  The total amount from Schedule 3 Line 8 flows to your Form 1040 Line 20.

[daisyismad]

It says my software is up to date. I've tried deleting and restarting the form and still getting the same result. I do co-own the home but I paid 100% of the cost of the heat pump. I assume that's why I'm getting two rows of input boxes.

When I go into the form, it lists the cost of the electric heat pump incorrectly and I do not have the ability to change this.

[DoninGA]

@daisyismad You must have selected that you share ownership of the home with another person and that you were the only one who paid for the energy-efficient improvements.

Is this correct?  If so, that limited your credit to $500.

What is your filing status?  Single or Married?  If married, how are you filing, Jointly or Separately?

[daisyismad]

I do co-own the house but fully paid for the heat pump. I'm filing single. Can you provide a link to the IRS page that states this limitation? I did not see it in my research. 

https://www.irs.gov/credits-deductions/energy-efficient-home-improvement-credit I do not see anywhere that states a $500 maximum for co-ownership.

[DoninGA]

@daisyismad After further investigation it looks like there is a bug in the program.  You should have received the full $2,000 credit.  This is a part of the program that is new for tax year 2023 so it appears further work on this section is required.  Looking at prior posts this is a known problem and a fix in the software is being made.

From IRS Form 5695 page 3 - https://www.irs.gov/pub/irs-pdf/i5695.pdf

Joint occupancy. If you owned your home jointly with someone other than your spouse, each owner must complete their own Form 5695. To figure the credit, enter the amounts you paid for these items on the appropriate lines of Form 5695, Part II. The amount allocable to you is the smaller of:
1. The amount you paid, or
2. The qualifying credit of the property multiplied by a fraction.
The numerator is the amount you paid and the denominator is the total amount paid by you and all other owners.

[daisyismad]

Thank you! How will I know when these fixes will be made?