According to the IRS 5695 Residential Energy Credits instructions and form for 2023 (not 2022) I should be allowed a $1200 credit for installing insulation to my home in 2023. See Line 18a on form 5695. Why hasn't Turbo Tax updated their system??
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Form 5695 is updated. The credit is non-refundable, meaning the credit can't reduce your tax liability past zero. Do you have an amount on 18b? That is the credit you qualify for. Then look at Lines 30-32 to see if it was limited by your tax liability.
How an I going to know my tax liability until I finish the whole return? Does the tax liability only include tax owed or tax owed after deducting all the taxes already paid (deducted from income, etc)?
TurboTax calculates your tax liability as you go. Your tax liability is the tax you owe on your total 2023 taxable income - it is on Line 16 and 18 of Form 1040. Child tax credits (line 19) are deducted and if you still have tax liability, the credit can be applied on Line 20 of Form 1040. The portion you can deduct will be entered on Schedule 1, Line 5b. (this amount will come from Form 5695 line 32).
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