Using the Solar and EV credits

Options
OutFishing
OutFishing Member Posts: 12 Level 4

This year we bought an used electric vehicle and had a small solar installed. I am wondering what credit will be used first on our tax return? I know the solar credit can get carried forward if I don't use it, so I would rather use the EV credit first and postpone the solar credit.

Thanks for your help. We love the new forum!

Comments

  • RBorch
    RBorch FreeTaxUSA Agent Posts: 22
    Options

    The Electric Vehicle Credit now known as the "Clean Car Credit" and the Solar Credit are calculated individually on your tax return. Since the Electric Vehicle Credit is a non-refundable credit and cannot be carried forward that credit will be used first towards your tax liability (if your vehicle qualifies for this credit). You can check by clicking the below link to the IRS website. https://www.irs.gov/credits-deductions/manufacturers-and-models-for-new-qualified-clean-vehicles-purchased-in-2022-and-before Then the solar credit also a non-refundable credit will be applied to the remaining tax liability. If the solar credit is more than your tax liability, then the remainder will be carried forward to next years tax return.

  • OutFishing
    OutFishing Member Posts: 12 Level 4
    Options

    Thank you so much. Your team is the best! I can confidently file my return now, knowing if I have any credits left over, then I can use the solar credit next year!