Idaho Alternative Energy Device Credit

[schestev]

Filing state taxes for 2023.

We met the conditions and qualify for 40% of installed cost in the first year for an EPA Certified Wood Stove. When I fill in the Type of Device and Total Cost boxes in the desktop turbotax software, I'm only getting ~2% credit.

Can anyone tell me why or what I need to do to get the full 40% this year?

[JohnW152]

You may be misinterpreting what this tax benefit does.

It's not a credit -- that is, it doesn't directly offset income tax. 

Rather, it's an Idaho subtraction from your federal income.  It'll be included in the Less: Idaho Subtractions line, as shown on the screen below:

If this doesn't address what you're seeing, provide more information so we can work through this. 

• What is the amount you entered for the device in 2023? 
• Did you enter any amounts for other years?  If so, what amounts, for which years?
• What's the amount of subtraction that resulted (see image above)?
• What was your federal taxable income?

To enter your Alternative Energy Device information 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 State Taxes box, then select Start, Continue, or Review/Edit
4. In the left pane, select Prepare State
5. Proceed through the screens until you come to the Status of your state returns screen
6. Select  Start, Continue or Edit to the right of Idaho.  If no state is shown, select + Add another state
7. Proceed through the state screens until you get to the Alternative Energy Device screen.  Select Yes, then select Continue
8. On the next screen, enter the required information, then select Continue

[schestev]

I think I see the problem.

I thought the 40% "credit" was a dollar-to-dollar tax liability reduction. It is not.

It gets included in the wizardly calculations to reduce the taxable income.

Thank you for your assistance.