I'm currently working on a client's tax return and came across they purchased a Tesla in year 2024 with advance credit of $7500. If they didn't receive this credit, then I can simply follow through the tax form and the program will automatically calculate how much EV tax credit they can received based on their income. Now that they already transferred the $7500 EV credit as down payment to Tesla, I entered $7500 on line 4a transferred credit to dealer. Then will I need to fill out anything else?
For example, when I entered this credit to one of my client that has itemized deduction (property tax paid and mortgage interest paid) and on 1099-NEC with around 70k income. If they didn't transfer this $7500 credit to the dealer, then they are only qualified to receive $3455 from the calculation. My question is because of this issue, am I missing anything on the 8936 form or schedule A which they need to pay back $7500 - $3455 = $4045 back to the IRS?
Thank You
I know we learned about how this works in the CEs I took late last year, but I dont remember the details, and I havent had any of these yet, so I havent needed to look it up. Im sure the instructions for Form 8636 explain it.
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