Solar Panel Tax Credit

Forum|Forum|4 years ago
July 27, 2022
1 reply
34 views

I installed Solar Panels in Nov '2020. Using TurboTax, it generated form 5695 but line 16 stated credit carryforward to 2021. The same thing happened when filing 2021 (carryforward to 2022). Since I am retired with no earned income, Do I need to have taxable income exceeding the Tax Credit amount before I can received the credit ? If not, why would I not receive the Tax Credit ?

Best answer by Faith C

Hi bowercg,

Thank you for asking! Based on IRS, "the residential energy property credit is nonrefundable. A nonrefundable tax credit allows taxpayers to lower their tax liability to zero, but not below zero." For your question, Yes, you will need to have taxable income exceeding the Tax Credit amount so you can receive the credit.

https://www.irs.gov/newsroom/energy-incentives-for-individuals-residential-property-updated-questions-and-answers

https://turbotax.intuit.com/tax-tips/going-green/federal-tax-credit-for-solar-energy/L7s9ZiB4D

I hope this answers to your question. If you have any further question, you can always call TurboTax Live so our Tax Expert can assist you with your tax scenario.

Faith CAnswer

Alumni - Intuit

Hi bowercg,

https://www.irs.gov/newsroom/energy-incentives-for-individuals-residential-property-updated-questions-and-answers

https://turbotax.intuit.com/tax-tips/going-green/federal-tax-credit-for-solar-energy/L7s9ZiB4D

I hope this answers to your question. If you have any further question, you can always call TurboTax Live so our Tax Expert can assist you with your tax scenario.

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