@CAViejo both the EV Credit and the Solar credit reduce Line 22 *your tax liability"), but this line can not go below zero.
The EV credit is applied first and if it can not be fully consumed, it is lost. (that would mean prior to applying the credit Line 22 was less than $7500.
However, the solar credit can be rolled over to future years until it is totally consumed. THere is no limit on how many years it can be rolled over. Each year, Line 22 would be reduced to zero until the entire credit is consumed.
Look at your 1040 line 22 for total tax. So as long as Line 22 is more than $7500 (before applying the credit), you can use the whole credit. It will reduce your income tax (but only to zero). If your non-refundable credits reduce your tax to 0 you will get back all the withholding and payments and any Refundable Credits. Unless you owe for something else like self employment tax or the 10% Early Withdrawal Penalty on IRA withdrawals.
Thank you! Additionally, I have a $16,000 tax credit for installing solar on my house. Can I claim that and then rollover the entire $16,000 credit to 2024?
Thank you! Additionally, I have a $16,000 tax credit for installing solar on my house. Can I claim that and then rollover the entire $16,000 credit to 2024?
@CAViejo both the EV Credit and the Solar credit reduce Line 22 *your tax liability"), but this line can not go below zero.
The EV credit is applied first and if it can not be fully consumed, it is lost. (that would mean prior to applying the credit Line 22 was less than $7500.
However, the solar credit can be rolled over to future years until it is totally consumed. THere is no limit on how many years it can be rolled over. Each year, Line 22 would be reduced to zero until the entire credit is consumed.