Is there an order of priority for an AMT credit and an energy creditmbinat

[patrickg1]

I've got an AMT credit carry-forward that is almost used up AND a credit for energy improvements. The combined total of the credits that TurboTax wants to use exceeds the total tax. 

- my understanding is the energy credit of $1200 does not carry-forward - so I would expect to use that first;

- as the AMT credit does (or has historically) carried-forward, I would expect it to adjust down so that the combination of credits equals total tax. TurboTax is NOT doing that. Schedule 3 forces the full amount from form 8801. So the question is whether this is correct or not? I don't understand why the AMT credit is forced to be used up when, by its use, it exceeds tax due.

Thank you. 

[AnnetteB6]

There is a specific order of credits.  Form 5695 itself limits the energy credit you can claim based on certain other credits being claimed on Schedule 3, however, the Form 8801 credit is not one of them.  

In order to take a closer look and try to explain your situation, it would be helpful to have a diagnostic copy of your tax data file.  The diagnostic file will not contain personally identifiable information, only numbers related to your tax forms.  If you would like to provide us with the diagnostic file, follow the instructions below and post the token number along with which version of TurboTax you are using and what states you are filing in a follow-up thread.

Use these steps if you are using TurboTax Online:

• Sign in to your account and be sure you are in your tax return.
• Select Tax Tools in the menu to the left.
• Select Tools.
• Select Share my file with agent.
• A pop-up message will appear, select OK to send the sanitized diagnostic copy to us.
• Post the token number here. 

If you are using a CD/downloaded version of TurboTax, use these steps:

• Select Online at the top of the screen.
• Select Send Tax File to Agent.
• Click OK.
• Post the token number here.

[patrickg1]

Token 1200517

Thank you. 

[AnnetteB6]

Thank you for sharing your token number and data file.  It turns out that due to many changes related to Form 5695, there is an issue with Form 8801 line 22.  This issue contributes to the credits not being claimed in exactly the correct order so that any energy credit is used before AMT prior year credit.  So, fixing the issue with Form 8801 line 22 will also correct the situation seen in your return with the order of the credits.

Take a look at the following TurboTax help article and use the link to register your email address so that you will be notified with updates to the situation.  

Why is IRS Form 8801 Line 22 calculating incorrectly?

@patrickg1