There's a bug in the way Turbo Tax is processing the EV Tax Credit and the Alternative Fuel Refilling credit. It will only allow me to claim one or the other.

[allensharveyjr]

It's not an issue of tax liability because I have had withholdings all year that greatly exceed the values of the credits. If I try to enter both, it only gives me the EV tax credit (full amount), but if I enter just the alternative fueling one for a charger, I get that full amount (it's up to $1000). I think when it applies the alternative fueling one, it's looking at the current tax refund being positive and saying it can't give me refund instead of looking at the tax liability - credits BEFORE taking into account my withholdings.

[SusanY1]

While the amount of your withholdings would cause your total refund to be higher, they don't change the way the credit applies.  Your withholding doesn't factor into the calculation of your total tax.  It is just a component of your refund to the extent that it exceeds that total tax. 

if there is no actual tax liability remaining after the first credit, the second credit cannot be applied (or may be reduced) no matter how much tax was withheld. 

The credits cannot reduce your total tax below 0, as neither is a refundable credit.  

[allensharveyjr]

I must not have been clear.  Suppose my tax liability before credits is $40,000.  Now let's say the EV tax credit is $7500.  That would reduce my liability to $32,500.  Now let's say I installed an EV Charger and that qualifies for another $1000 credit.  That would reduce my liability to $31,500, right?

If I had withholdings for the year in the amount of $35,000, that means I overpaid by $3,500 (35,000-31,500 = $3,500).   However that's not what TurboTax Online is calculating.  It's saying I only overpaid by $2,500.  

Under the hood, when it first applies the EV credit, it says I will get a refund of $2,500.  Then when it looks at the next credit, it thinks I do not have any tax liability (ignoring that I have effectively overpaid), and reduces the 2nd credit to $0.  This is not correct.  If I edit my W2 to say I didn't have any federal tax withholdings, then i get the full credit.  

[SusanY1]

Thank you for this additional information.  I'd like to take a closer look at what is happening in this instance.  

In order for me to examine this more closely, I would like to look at a redacted version of your tax data file.  You can share this with us by going to the lefthand menu in TurboTax online and selecting Tools, then Tax Tools and in the pop up box selecting "Share my file with an agent".  

Then return here and post the token/code that displays.  If you have TurboTax Desktop, the option to send your file to agent is in the Online menu.  

We'll take a look once we have this file so that we can see what you're experiencing and help identify the issue and its resolution.  

[allensharveyjr]

1325186

[AnnetteB6]

Thank you for providing your token number so that your return could be examined in greater detail.

After taking a look, I can see why you  are not getting the additional credit for the Alternative Fuel Vehicle Refueling Property Credit.  It is not related to or affected by changing your tax withholdings.  There is a very common reason that taxpayers are not eligible to claim the Form 8911.  It is related to the tentative minimum tax calculation.  

Even though you may not be subject to Alternative Minimum Tax, it is calculated at the same time as the regular income tax.  The tentative minimum tax is compared to your regular income tax on Form 8911.  If the tentative minimum tax is greater than the regular tax, then the Form 8911 credit is disallowed.  

Without giving any specific numbers from your return, Form 8911 line 8 is about $2700 greater than line 7.  Therefore, the credit is disallowed due to the tentative minimum tax.  

Even though Form 8911 will not be included as part of your tax return because the credit is disallowed, you should be able to specify Form 8911 to be printed or previewed from the Print Center using TurboTax Online to take a look at the details.  

If you are using a CD/downloaded version of TurboTax, you can go to Forms in the upper right corner.  Then click on Form 8911-A in the panel on the left side of the screen.  Scroll to the bottom of the page and click QuickZoom to Form 8911 to see the lines described above.

I also adjusted the withholdings as you described and verified that this did not change the outcome for your return.

[allensharveyjr]

I am trying to finish my taxes tonight, and when I get to my AMT calculation page, I can see the tentative tax and regular tax.  The numbers I see there shows that the regular tax is higher, so I should be eligible for the credit.  Is Turbo Tax reversing the numbers in error?  If you can double check mine now, I would appreciate it.