Schedule A form 8936 Line 16 not blank.

[Linda P]

Hello,

I bought a new EV on before Oct 1 2025 and transferred the credit to the dealership at the time of sale for $7,500.  I qualify for full credit base on my MAGI and HoH status.  I don't understand why line 16 Maximum vehicle credit amount shows $4,000 there.  There is nothing filled out on Part IV except line 16 and it should be blank.

4a. $7,500

5. Yes

8a. No, 8b. Yes, 8c. No

[MindyB]

The $4,000 maximum is the amount for used cars.  Since you have box 5 checked yes, I would not have expected to see $4,000.  I tried to replicate this and was unable to.  I would suggest deleting the form and re-entering it, to ensure that if something is "stuck" in the background it is reset.  

Go to Tax Tools on the left of your screen, then Tools, then select Delete a form.  Choose the trash can next to 8936. Then, re-enter the info making sure "new" is checked again. 

[Linda P]

I did what you suggested and still didn't dix the issue.  I tried on other returns and still the same problem.  That $4000 seems like it's refilled on the form.  Will it cause IRS issue if it stays there like this since I can't remove it?

[MarilynG1]

If you transferred your $7,500 EV credit to the dealer at the point of sale, you are not eligible to claim the credit again on your tax return, meaning it will not reduce your tax liability or increase your refund. You must still file Form 8936 and Schedule A to reconcile the transfer. You should show $0 on Line 13 of Form 8936.

You may qualify for the Car Loan Interest Deduction, however, so you may want to step through the interview in the Deduction section.

@Linda P 

[Linda P]

I understand that. I am not looking to claim the credit.  Please read MindyB response.  She understood my question.  $4,000 for used car credit should not be there at all as this is a NEW car purchase.  I tried online turbo tax version, started the return from the scratch, used different computer, that $4,000 on line 16 doesn't come off at all.  It appears to be prefilled on the form.  I need to remove that $4,000 which it not possible to remove at all.  I tried a different tax software and did not have that issue.  So it's a BUG in the form.

[Vanessa A]

I would like to take a deeper look at this. However, I need a diagnostic file which is a copy of your tax return that has all of your personal information removed. You can send one to us by following the directions below:

TurboTax Online:

1. Sign into your online account.
2. Locate the Tax Tools on the left-hand side of the screen.
3. A drop-down will appear. Select Tools
4. On the pop-up screen, click on “Share my file with agent.”
5. This will generate a message that a diagnostic file gets sanitized and transmitted to us.
6. Please provide the Token Number that was generated in the response.

TurboTax Desktop/Download Versions:

1. Open your return.
2. Click the Online tab in the black bar across the top of TurboTax and select “Send Tax File to Agent” *
3. This will generate a message that a diagnostic copy will be created.  Click on OK and the tax file will be sanitized and transmitted to us.
4. Please provide the Token Number  (including the dash) that was generated in the response.

*(If using a MAC, go to the menu at the top of the screen, select Help, then, “Send Tax File to Agent”)

[Linda P]

Token: 9059978132196421-93494393

Problem with form 8936 Line 16 should be blank.

[Bwon84]

Does anyone have a resolution? Im having the same issue. I bought a brand new Tesla Y and it keeps showing $4000 on line 16. I called turbotax and theyre not helping at all so Im at a point of returning the software to Coscto and also write a major complaint of how terrible this software is.

[Bwon84]

By the way, this could be a HUGE issue if we file like this. Im glad I double checked the form but I feel bad for all the people that bought a brand new EV last year and filed their taxes with incorrect information. TURBOTAX NEEDS TO FIX THIS ASAP!!!!

[Linda P]

I sent the file to them as requested but have not heard back yet.  Even their online version is having the same issue.

[Linda P]

Agree!!  I am waiting to get this resolve before I file.  Hopefully they will deploy a new update to fix this form ASAP.

[Vanessa A]

After looking further into this, this is not an error and is not affecting the calculations.  This is a hard limit that is on the form for previously used vehicles.  If you look at line 4a, you will see the actual amount of the credit.  Line 16 is not being used in any calculations relevant to this situation. 

@Bwon84 @Linda P 

[zhangxinya2004]

Hi Linda,

I ran into the exact same issue you mentioned regarding TurboTax/Tesla EV credit and was wondering how you were able to resolve it. I also purchased TurboTax through Costco.

I’d really appreciate any guidance you can share. Thanks so much for your time, and I look forward to hearing from you.

Thank you!

[AmyC]

TurboTax puts a cap on a line before checking if you even need that section. If your final refund matches your expectations and doesn't include an extra $4,000 credit you didn't ask for, you are safe to file.

Check here:

• Schedule A, Line 17: If Line 17 is blank or $0, the $4,000 on Line 16 is a dormant number that isn't being added to your tax liability or refund.
• Verify Form 8936, Part I: Ensure Line 4a correctly shows your $7,500 transfer. This is the most critical line for the IRS to see that the credit was handled at the dealership.
• Review your "Tax Summary": Look at your total tax and credits. If you don't see a $4,000 credit being applied to your bottom line, the software is ignoring that Line 16 value just as it should.

@zhangxinya2004