I installed a solar system in 2019 for $60783. It is on a 5-year depreciation schedule. I have $18,235 carry forward of tax credit. I owe taxes this year so want to use it. When I fill out form 5695, I only get $1,118 credit. Either I entered something wrong, or I'm totally confused about being able th use the carryforward to decrease my tax liability. Thanks much.
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The solar credit is a nonrefundable credit so if the credit reduces your tax liability to zero the remaining credit is carried forward to the next tax year.
Thank you. That's what I was told from the installing company. On line 29 of form 5695 it shows only $1,188 for non-business energy tax credit. Do you have any idea where I might be going wrong?
@spudmill69 wrote:
Thank you. That's what I was told from the installing company. On line 29 of form 5695 it shows only $1,188 for non-business energy tax credit. Do you have any idea where I might be going wrong?
Doubtful you are doing anything wrong. The TurboTax program follows the rules for Form 5695 as shown in the Form 5695 instructions so only the credit which reduces your tax liability to zero is entered on the Form 5695.
For Line 29 on Form 5695 the worksheet for Line 29 is used. Go to the Form 5695 Instructions on page 7 for the Line 29 Nonbusiness Energy Property Credit Limit Worksheet - https://www.irs.gov/pub/irs-pdf/i5695.pdf#page=7
The amount from Form 5695 Line 30 flows to Schedule 3 Line 5. The amount from Schedule 3 Part I Line 8 flows to the Form 1040 Line 20
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