EV tax credit reduced after last Turbotax update

[mandmkimroos]

I purchased a Tesla Model 3 on May 1, 2019, and thus was supposed to get a tax credit of $3750. I've been doing my taxes on Turbotax the past month and the $3750 credit was affirmed after I entered the full data on the Model 3 purchase. However, following the most recent Turbotax update (02/22/2020), the credit was cut in half to $1875. I got the message that if the amount is less than I was expecting it is either due to the amount of tax that I owe or other credits that I am getting. But nothing has changed in my date since before the Turbotax update. What is the difference? Can someone explain to me how and why the credit was cut in half?

[JotikaT2]

Before the update, the credit was not being calculated at the correct percentage.  It is now being calculated correctly based upon your purchase date.

I recommend you review your input on each of the fields as your input does affect the credit calculation.  

You should make sure all of the information from the battery capacity, date purchased, and weight are entered accurately.  The credit will vary based upon your input. 

Please note the credit amounts vary based upon the time of purchase and the amount of the credit still available. 

The amounts listed on the IRS website provide the maximum credit you could receive, but the actual credit is determined based upon your answers to the questions.

IRS Electric Vehicle Credit

[mandmkimroos]

The information I have entered is accurate: 

Date purchased: 05/01/2019

Placed in service: 05/01/2019

Battery Capacity: 75 kWh

Gross Vehicle Weight: 4,993 lbs.

According to the IRS website chart, the credit should be $3,750. Is the TurboTax software in error? 

[AnnetteB6]

Be sure that you do not change the maximum credit amount shown on the screen, otherwise the calculation will not be correct.  

Here is the explanation:  

TurboTax will calculate your maximum credit based on the details entered for your vehicle and any applicable phase-out based on the purchase date. 

On the screen where it shows the amount of credit you qualify to receive, the box at the bottom of the page is showing the maximum credit that would have been allowed for your vehicle had a phase-out not applied.  Your credit may be limited by the phase-out.  If you change the number on that screen, your credit will not be calculated correctly.  

The information on the screen says this field is for adjusting the amount of maximum credit it is does not match the manufacturer's specification.  The number entered here will be the maximum credit that you may receive prior to any limitation being applied.  If you change it, your credit will be based on the number entered.  

Please let me know if this was helpful or if you still have an issue or an error condition.