Residential Energy Credit - Form 5695

[catherine3]

I am trying to take the residential energy credit for my clients, married filing jointly. One of the parties is self-employed. I completed form 5695. However, the credit is being carried forward to 2024, Their information is:

AGI                                           $36,368
Standard Deduction                  (29,200)
QBI                                           (  1,434)
Taxable Income                           5,734
Tax                                                 573
Other Credits (not energy)           (573)
Other Taxes (Sch C self emp)     3,151

I think I just answered my own question. Is my client's tax credit being deferred to 2024 because it is not applied against self-employment taxes? 

Thank you in advance for any help.

[Camp1040]

It is a non-refundable credit, can't be more than your income tax liability.

[Just-Lisa-Now- · Accepted solution]

Yep, it only offsets Income Taxes, not Self Employment taxes.

[TaxGuyBill]

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@catherine3 wrote:

Is my client's tax credit being deferred to 2024 because it is not applied against self-employment taxes? 

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What item did they purchase that qualifies for the credit?  If it is on page 2 of the 5695, the credit will NOT be carried to next year.  Only credits on page one qualify to be carried to future years.

[catherine3]

They purchased solar panels for their primary residence. It is on the first page. I hope it carries over to 2024: