The home energy credit is not correctly calculating that is is a non-refundable credit. What is the ETA on that getting fixed. I'm dead in the water.

[caroleaaaac]

The home energy credit is not correctly calculating that is is a non-refundable credit. i.e I am due ~$20k credit but I owe only ~$1k.  I should see my Federal tax due be Zero $.  What is the ETA on that getting fixed. I'm dead in the water.

[Vanessa A]

Is this a solar credit? Are you seeing this credit on form 5695 or where are you seeing the credit amount? If this is a solar credit, you can carry forward the remaining balance that you are unable to use this year.  So your credit would not be limited for the amount of credit you would receive in total, just the amount you can take of it this year. 

If you look at your 1040 form, you should see on line 16 your starting tax. Is this where you see $1,000? Then you will see other credits you may be eligible for that will reduce your tax.  Then on line 20, you will see an amount from Schedule 3 that is a sum of all several nonrefundable credits including the Home Energy Credits. If your amount on line 16 is only $1,000, then the amount on line 20 (if no other credits) would be $1,000. If you do not have an amount on line 23, then you should see the amount on line 24 reduce to $0 (if you have a 20k credit) Then you will see on line 25 your withholdings.  If like 24 is $0, then you would get all of your withholdings back.  

You will then have a carryforward on form 5695 of $19k. 

This is a nonrefundable credit, and does seem to be working properly.  If this is not similar to what you are seeing, please provide more detail such as what numbers are on lines 16 through 35 on your 1040.

On the menu bar on the left that shows. 

1. Select Tax Tools
2. On the drop-down select Tools
3. On the pop-up menu
4. Select View Tax Summary
5. On the left sidebar, select Preview my 1040

If you are using the desktop version, you will just need to click on forms mode. 

[caroleaaaac]

Yes solar credit

I'm not looking at form 5695.  I'm going through the guide me steps.

1040 line 16 39,601

18 39,061

20 19,689

21 19,689

22 19,372

24 has 19,372 not 0

25d 37,888

33 37,888

34 18,516

35a 18,516

My Federal tax owed before inputting the solar credit is $1,173.  

Now inputting the solar credit, TurboTax is stating that I am due a refund  $18,516.00.  That is incorrect because it is a non-deductible tax credit.  That is my issue that needs resolution.

[Vanessa A · Accepted solution]

Your numbers are actually correct. A nonrefundable credit means that you don't just get money back that YOU DID NOT pay in.  It is different thana refundable credit like the Additional Child Tax Credit or the Earned Income Credit, where you get back money even if you didn't pay anything in.

When a nonrefundable credit lowers your tax liability, it DOES allow you to get a refund of the amount YOU PAID IN.  So, the $37,888 that you had either withheld or paid in, you over paid once the solar credit was added into the mix. Before the credit, you still owed the government $1,173 because you underpaid your liability. Now you are getting back the $18,516 that you overpaid to the IRS because your tax liability was reduced by $19,689 because of the solar credit.

 The nonrefundable credits can give you a refund of YOUR money that was yours to start with, but it will NOT give you a refund of the GOVERNMENTS money.  

A Refundable credit will give you a refund of GOVERNMENT money that was never yours and that you never paid in.

[caroleaaaac]

Excellent.  Thank you! Now I just need this part to work on a second home.  There is another post on that problem.