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rch4013
January 28, 2023
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Residential Clean Energy Credit

  • January 28, 2023
  • 1 reply
  • 0 views

I completed form 5695 in TurboTax and for some reason it is treating my solar project costs as a refundable credit instead of offsetting against my tax liability.

 

Can anyone help guide me to where I  made my error?

 

Thank you

      Best answer by JulieS

      Yes, that is correct. Even though the energy credits are non-refundable, they can reduce your tax and allow you to get a bigger refund, as long as you have payments, that is tax withheld, estimated tax paid or refundable credits. 

       

      1 reply

      AmyC
      AmyC
      January 31, 2023

      Form 5695 is reported on sch 3, part 1, line 5, nonrefundable credits.  It is reported on the 1040, line 20 and subtracted from your tax liability.

       

      Refundable credits come into play when your tax liability has zeroed out. You are correct, you should not see 5695 credits as refundable.

       

      Can you clarify what you are seeing that is different from what I listed above?

      **Say "Thanks" by clicking the thumb icon in a post**Mark the post that answers your question by clicking on "Mark as Best Answer"
      R
      rch4013Author
      February 11, 2023

      Thank you, Amy -

       

      I have completed form 5695 for the solar panel project and it has calculated the 30% number for the tax credit.

       

      Schedule 3, part 1, line 5 has this amount.

       

      This amount is also on line 20 of Form 1040.  

       

      However, for some reason Turbo Tax is treating it as a refundable credit instead of reducing my tax owed to $0 from the credit. 

       

      I must be missing something...

       

      Thank you for your help.

       

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