Qualified Plug-In Electric Drive Motor Vehicle Credit

[MattA19]

If the Qualified Plug-In Electric Drive Motor Vehicle Credit is non-refundable, then why did Turbo Tax calculate a refund equal to the difference between the tax amount I owed (over $800) and the total value of the refund ($4,543)?  I think there is bug with Turbo Tax.  I don't want to receive a refund of over $3,000 that is not correct and that I have to pay back after I file my taxes. Please help.

[JotikaT2 · Accepted solution]

TurboTax is currently working on fixing an issue with how the credit is calculated in the program.  Please see the attached for more information on how to be updated when they rectify the issue.

Motor vehicle credit is not calculating correctly

[Anonymous]

A new version of TurboTax, released 2/20/2020 allows calculation of the non-refundable Qualified Plug-in Electric Drive Motor Vehicle Credit for plug-in vehicles.  An electronic return filed prior to 2/20/2020 was returned with a message from TurboTax to try again after 2/20/2020 updates implement IRS Form 8936.  Turbo Tax now calculates the EV credit, however, the user is presented with a confusing final screen which displays a box labeled ‘Credit Amount’ with box content  ‘$7,500’. This is the total EV credit available prior to phase-out (GM and Tesla in 2019).  If the user types in the remaining credit they are entitled to receive of, say $1,875 (available from Chevy, Tesla, or https://www.irs.gov/businesses/irc-30d-new-qualified-plug-in-electric-drive-motor-vehicle-credit), Turbo tax will incorrectly calculate 1/4 that amount (i.e.,  $1,875/$7,500*$1,875=$469) as the credit.  The take-home message is don’t enter the actual credit amount you are entitled to in the box ‘Credit Amount’, becuase Turbo Tax uses that box to indicate what the original (i.e., in 2016, 2017, 2018) tax credit was. 

[CindyS]

This makes no sense

[KrisD15]

The software has been updated but please do not adjust the credit amount. It is confusing, but the screen that shows the amount the credit is based on is not the final amount of the credit, so please don't be tempted to reduce it. 

[TXTODD]

When I input my Tesla3 credit it shows I get a $7,500 tax credit but only calculates $3,750.

Should I wait until TurboTax fixes the program or can I file now and get the additional credit down the road?

[KarenJ2]

The issue has been resolved.  I do not know why you are only receiving half of the the credit.  Please see the instructions attached.  You can always file now and amend later.   

2019 Instructions for Form 8936

[Anonymous]

See the document posted by  KarenJ2 and the section on "phaseout."  Tesla has exceeded the number of vehicles for which the full $7,500 credit applies, and it decreased to $3,750 for the first half of 2019, $1,875 later.  Which amount you qualified for depends on when you bought it.  I bought my Model 3 in late December and received $1,875 credit.

[arturoayasan]

Mine says I get an $1875 credit, even though the IRS website says that if I purchased the car from 1/1/2019 through 6/30/2019 I should get the $3750. I have a model 3 standard plus, IRS.GOV shows I qualify for a $3750 credit, my online turbotax return shows $1875. What am I doing wrong? @JotikaT2

edit: I purchased my Tesla Model 3 on 3/28/2019

[arturoayasan]

Update: I deleted the car from my return then re-added it, I noticed that the adjusted amount was set to 7500 automatically. I deleted the amount then clicked next. The credit then was added as $3750. When I do look at the overview of my return, under Energy efficient vehicles it shows a credit of 7500.

So it looks like Turbo Tax will list half of whatever you enter in the adjusted credit amount.

[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.  

@arturoayasan

[lwhlouky]

Let me know, please.

My car was purchased after August 2022 (October 2022) but it was assembled in the USA

and is within in the weight, tire, and kwh qualifications

[email address removed]

[Vanessa A]

Let you know what?  

You can look here to see if your car qualifies for the EV credit as only certain models are eligible. If you enter your VIN, Make and Model as well as purchase date, TurboTax will calculate your EV Credit.

Be aware, this is a non-refundable credit.  This means, your credit will be limited to your tax liability.   If you only have a tax liability of $1,000, and the car qualified for $7,500, you would only get a $1,000 credit.