My return is ready for filing, however Form 5695 home energy tax credits hasn't been approved by the IRS yet. Should I go ahead and file now or wait for this form?

[wdslvr1]

We qualify for this credit in 2019 for a metal roof installation.

[TomK100]

If you can wait, that may be a better option then filing an amended tax return (1040-X).  The tentative date for Form 5695 (Residential Energy Credits) is 1/29/2020.  

[wdslvr1]

Now that I read the tax credit further, it states 30% of the cost as a credit toward your return IF you owe taxes.  The way I understand it,  is that if you are already receiving a refund, it doesn't apply?

[BillM223]

To address your last question, this means that the credit generated by your expense will be applied only to taxes you were assessed, not what your refund is.

If you have a refund because of your withholding, then the credit is applied to the tax before the withholding. This may have the effect of increasing your refund.

But if the credit exceeds the taxes that were assessed (before withholding and estimated taxes), then the credit will be limited to the amount of taxes you were assessed.

For example, you were assessed $3,000 in taxes, and your withholding is $4,500. If you credit is $1,500, then the $1,500 will be applied to your assessed tax, and the amount of your withholding will increase your refund by the $1,500.

If you were assessed $3,000 in taxes, and your withholding is $4,500. If you credit is $4,500, then only $3,000 of the credit will be applied to your assessed tax, and the amount of your withholding will increase your refund by only the $3,000.

[TomK100]

A tax credit is a dollar-for-dollar reduction of the income tax you owe. For example, if you owe $1,000 in federal taxes but are eligible for a $1,000 tax credit, your net liability drops to zero. 

[TerryHays]

A bit confused here::::

My Federal tax bill was $3000 prior to filling out the 5695 form through turbo tax.  Install a large Solar energy system and the calculation from the form said I was eligible for a $6,200 credit (6.21 Kw @ $500 / .5 Kw  or ((6.21/.5) * 500). 

1. project completed in Jan 2021

2. There were ZERO energy credits from previous tax years

3. Primary Residence, Lived with wife in home

4. Resulted in ZERO HOME ENERGY Credit for 2021 tax year but we a $6,210 credit to roll forward in 2022.

So, what the heck is going on?? I checked the 5696 forms and worksheets and this is pure gobligook. It really looks like they are doing their best to carry this forward forever and never actually take the credit.

So my assumption was that with a tax bill of $3000 the Energy credit would take effect and reduce the amount owed for 2021 tax year.  I really don't trust that the government will apply the $6,210 tax credit to 2022 tax year if it can't apply it now!!

Question:  Anyone having problems with this 5695 energy tax credit.  What did I do wrong!!!