I'm totally confused what to do with form 8936 - Clean vehicle credits

[LindaS5247]

To get Schedule A to generate, try going out of your program and going back in.  Make sure all updates have been run for your TurboTax program. Then check to see if Schedule A is there. I have seen people posting that their Schedule A is now there.

Click here for information on manually updating TurboTax.

To check for Schedule A in TurboTax Online click here for the instructions. ‌To do this in TurboTax Desktop, switch to "Forms Mode" and select your forms in the left panel of your screen.

To review your screens in TurboTax Desktop

 Go to "Deductions & Credits",

Scroll to "Cars and Other Things You Own", 

click "Start or Update" next to "Energy-Efficient Vehicle" 

Review your screens and make sure everything has been answered correctly

To review your screens in TurboTax Online:

"Continue where you left off"

Click on "Deductions & Credits" in the left panel of your screen

Scroll down to "Cars & Other Things You Own"

Click on the (down-facing) caret

Select "Energy-Efficient Vehicles"

Review your screens and make sure everything has been answered correctly

If you completed the screens for "Energy Efficient Vehicles"' it will be reported on Form 8936 which is included as part of your tax return. A Form 8936 and Schedule A (Form 8936) should be included with the tax return you completed using TurboTax.

Click here for additional information on Form 8936.

Click here for "Understanding the New Clean Vehicle Credit"

Click here for "What's a clean vehicle credit?"

If you issue is not resolved, please come back to TurboTax Community with any additional information or questions you may have and we will be glad to help you.

[Ryan F]

I just received the same notice. However, when I look at the transcript through IRS.Gov, my 8936 Schedule A doesn’t show my vin, service date, or the credit amount. Shouldn’t that have the information I entered into Turbotax?

[shorthills8]

What interview are you referring to?  How do I get to it???

[AnnetteB6]

To get to the section of your return to enter information needed to claim the Energy-efficient Vehicle Credit, go to Deductions and Credits > Cars and Other Things You Own > Energy-Efficient Vehicles and click Start or Update.

This will take you through the process of claiming a credit for purchasing an EV.

Or, click the magnifying glass at the top of the screen and enter 'electric vehicle' into the search box.  Then click the link provided by the search.

@shorthills8 

[Ronald151]

I have a connected question. If I use EasyStep and fill in the requested information, the response I receive is that I cannot deduct the $7500 from my tax bill. However, the $7500 was an advance on my refund for 2024, which the dealer received. But without being able to deduct the $7500 from my tax bill, I am essentially repaying the government for the $7500 that they paid my dealer. The result is that the $7500 proves to have been a loan rather than a credit. This can't be right.

[prabekal]

I am having the same issue.  I e-filed my federal and state forms.
Received a letter from IRS dated 17-Feb-2025, you required to file a completed form 8936, Clean Vehicle Credits and Form 8936, Schedule A.

What do I need to do ?

[Ronald151]

Do a search under forms for schedule A. There is a schedule A that includes "8936" in its title.

[Ronald151]

Click on "forms" and type in Form 8936. Also type in Schedule A (8936). You will need both. If you are using EasyStep, the process is under "credits" on taxes.

[Ronald151]

In talking with Turbotax advisors (one of their tax advisors, who also drew in a higher level tech person) I discovered that a flaw in the programming is that if you answer the question of whether you received the credit from the dealer with "yes," the forms do not compute your credit right; in fact, the program will tell you that your credit is ZERO. This is a glitch in the system. I was instructed to answer the question with "NO" to obviate the problem, but this results in form 8936 wrongly stating that you did not receive the credit from the retailer. Turbotax needs to fix this. But in the meantime, if you do not mind filing by mail, you can correct the response on a hardcopy of 8936.

Hopefully someone from Turbotax sees this and effects the change.

[PaulaM]

If you transferred the EV credit at the point of sale, you will not receive a credit on your tax return. The credit will be reported as zero. You still have to complete Form 8936 and Form 8936-A to confirm your eligibility for the credit you transferred.  Most sale details have been reported to the IRS by the dealer already. 

[MB332]

Ok, I totally forgot to put 8936 stuff in my Turbotax, now I went back in and redid the form, do I have to file an amended return and print it off and mail it or is there a way to update Turbotax and have the amended return filed electronically??

[Ronald151]

I got the advice you are offering from a person at Turbotax last week (after Turbotax said I had ZERO credit). But after reflecting on the issue, it made little sense to me, and I spent an hour yesterday talking with a tax advisor at Turbotax, and she agreed with me.

Here is the issue: the $7500 is a credit on this year's taxes: whether it is given to the dealer at the time of sale or taken as a reduced payment at the time of taxes, it comes from the same credit. I could have elected to wait until filing to recoup the money for the credit when filing taxes (perhaps using the savings as a car payment), but the money would have been the same credit used by the dealer to reduce my cost at the time of purchase. All the IRS did was to advance that payment to the dealer rather than me wait to receive it now.

 If I could not deduct the credit on taxes, the $7500 from the dealer would turn into either a loan (which IRS now requires repaid) or it was an outright gift from the government – neither of which is the case.. Since it was a credit on 2024 taxes, the only difference between having it advanced through the dealer or claiming it now is temporal. I won't get any more money now, because the money comes from the same source: the credit on my 2024 taxes.

After working with the tax advisor on the phone, she brought in someone from a higher level to review it with us, and she agreed, instructing me to fix it by saying that I should answer the question about the dealer paying the $7500 at point-of-sale with "NO." The problem is really a glitch in how Turbotax has set up the forms in EasyStep. I emphasized that someone needs to change the programming, inasmuch as, if I submit the forms digitally, reporting that I did not receive the payment at time of sale is going to create a conflict when the form is read at IRS, because they have the report from my dealer. An alternative is to print off the forms, change the mark on that question, and submit the forms by mail. But it really should be resolved by Turbotax.

[rwells3663]

I have a similar question, my return shows as accepted but I received the letter from the IRS asking for the 8396. The dealer where I purchased the vehicle had not done many EVs and incorrectly told me I could claim (they claimed it at time of purchase). When I go in and amend from NO to YES, I show that now I owe money.  My attempt to file amendment gets rejected (my guess is that they are expecting a check). Even without the credit I would still expect to receive a return but I am unsure on how to proceed. Thank you!

[SusanY1]

When you amend a return, the data resets back to $0 so a payment showing is the amount of the previously issued refund that you will be repaying.  The return won't reject for lack of attached payment, so that's a separate issue for us to troubleshoot. 

Was is the rejection error code/message that you receive when you attempt to amend?  

Also, does your notice request that you amend your return? If not, it is better to follow the instructions in the letter than to amend the return.  

[rwells3663]

The letter is requesting a 8936 and an 8936 Schedule A, my assumption was that by ammending the return it would correctly designate the forms required as originally I indicated that dealer did not take credit (which ultimately i found out they did).  The error when i filed the amendment was:

Invalid method of payment value for TBM feature: Balance Due: Traditional Check