Claim the credit for the 2021 tax return because that is when you purchased it. Even if you are paying monthly the date of the contract is when considered to be purchased.
How do I add 5695 to TurboTax?
Form 5695
- Open (continue) your tax return in TurboTax Online.
- Click My Account (top right of your screen).
- Click Tools.
- In the pop-up window, click Topic Search.
- In the search bar, type 5695.
- In the topic box, highlight 5695, residential energy credit, then click GO.
To claim the credit, you must file IRS Form 5695 as part of your tax return. You'll calculate the credit on Part I of the form, and then enter the result on your 1040.
- If in 2021 you end up with a bigger credit than you have income tax due — a $3,000 credit on a $2,500 tax bill, for instance—you can't use the credit to get money back from the IRS. Instead, you can carry the credit over to tax year 2022.
- If you failed to claim the credit in a previous year, you can file an amended return.
Currently, the residential solar tax credit is set to expire at the end of 2023. If you're thinking about adding solar energy to your home, now might be the right time to act.
TurboTax will search over 350 deductions to get your maximum refund, guaranteed. If you’re a homeowner, TurboTax Deluxe gives you step-by-step guidance to help turn your biggest investment into your biggest tax break.
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