I'm getting solar installed on my house in a few weeks. Since I'm financing it, I will qualify for the federal solar tax credit. I typically owe on my federal taxes about $4-6k. I want to make sure I max out the $8.5k credit I'll be able to claim. I currently claim 0 on my W-4 and wonder if I should adjust it to have less taken out so that I will owe more.
Hello
There is no need to adjust your W-4 for the solar credit since it is not a refundable credit since it will be applied to total taxes and if the credit is more than your total tax it will be carried into the following year. The max credit now is 26%.
Good luck to you.
The reason I'm trying to get as much of it this year is because my loan will allow me to make a single payment to it with the credit and have it re-amortized.
Hi kylehayes,
Thank you for clarifying and it makes total sense why you would like to max out the credit. Smart! To answer your question, please use our W-4 Calculator which will give you a good idea about your withholding. Our tax calculator also will be a great tool to assist you based on your tax situation. In that way, you can find a better estimate on your 2022 tax which will allow you to get as much solar credit possible and also avoid any potential underpayment penalty.
W-4 Calculator: https://turbotax.intuit.com/tax-tools/calculators/w4/
Tax Calculator: https://turbotax.intuit.com/tax-tools/calculators/taxcaster/
We hope this will help!