solar credits

[jempim]

Why is it that I have a federal refund of let's say $1,000 showing on my turbo tax premier (after all income and deductions are entered) but when I enter the cost of the solar panel installation to get the tax credit of $15,000, my refund only increases $10,000?

[MichaelG81]

It depends, if your tax due on your 1040 is more than your solar credit; the remaining solar credit will carryover to next year, if applicable. If you have 15,000 in solar credit available and only using 10,000 this year, 5,000 will carry over to next year because again, taxes due weren't enough to take full credit, if applicable. It is a credit against taxes due, not a refundable credit. However, if you paid taxes due/or had taxes taken from your job and have a tax due, the credit will work with it and increase your refund based on taxes paid for the year; and in some cases cutting the tax due bringing up to all you paid in taxes back to you.

@jempim 

[jempim]

Thanks,that's what i thought and i paid federal taxes through my payroll deductions of over $25000 already so the credit is way less than what i paid or owe.  Which is why i don't understand why the full credit is not being applied.  This also happened to me last year for the EV car and charger credit.  The full amount wasn't reflected on my return by turbo tax.   I think turbo tax software just doesn't know how to use the credit and you get shortchanged.   I'll probably have to talk to a CPA to see what the errors with the software preparation is.

[Opus 17]

The credit is 30% of the cost, did you really spend $50,000 on your system?

[jempim]

yes i did

[Opus 17]

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@jempim wrote:

Thanks,that's what i thought and i paid federal taxes through my payroll deductions of over $25000 already so the credit is way less than what i paid or owe.  Which is why i don't understand why the full credit is not being applied.  This also happened to me last year for the EV car and charger credit.  The full amount wasn't reflected on my return by turbo tax.   I think turbo tax software just doesn't know how to use the credit and you get shortchanged.   I'll probably have to talk to a CPA to see what the errors with the software preparation is.

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Part of the problem is that you can't view the actual tax forms in Turbotax online unless you pay the filing fees.  You should be able to preview your form 1040, check lines 16-24, and schedule 3 line 5, if you can view them.

If you are using Turbotax installed on your own computer, you can switch to forms mode at any time and review the forms.  What is your tax on form 1040 line 16, and the credit on line 20?  What is the entry in schedule 3, line 5?