When I enter the Residential Energy Credit and it gives a credit of $500, refund is not increased.

[MNH]

When I enter the Residential Energy Credit and it gives a credit of $500, refund is not increased.  The customer had prior Total Tax of $13,086.  The $500 Energy Credit reduced it to $12,586.  Their taxes paid were $17,762.  Refund is only computing $4,676 instead of $5,176.  Any ideas?

[dascpa]

The form is not final.  It's basing the calc on 2022 law.  you'll have to wait for the forthcoming update.

[Just-Lisa-Now-]

:Its not a refundable credit, it only reduces tax liability, so it wont necessarily increase a refund amount.

LOOK at the tax return and follow the money on the 1040.   Is it the math  just plain wrong?

[dascpa]

I did one last night and couldn't figure out why the amount didn't tie.  Went back to a compare of 2022 and 2023 instructions and saw that the gas furnace credit was still picking up the 2022 credit amount.

[taxiowa]

Yah, I agree, they are still using last years figures.  I have a whole box of returns waiting for 2/07 when hopefully they get it fixed.  Nothing transfers to 1040 as of now.  So we wait....

[Just-Lisa-Now-]

So it doesnt even carry over to the 1040?  I see solar credit carries as expected.

[MNH]

I know it's not refundable, which is why I know there is something wrong.  The math isn't adding up from what they paid in to what their total tax is.  It's off by $500, which is the energy credit. On form 5695, it shows the credit being issued for $500 and on the tax calculation form it shows it, however, the program appears to have a glitch.  It's getting frustrating this year.  Too many issues where I've had to call them.  

[MNH]

I thought of that, however, all of my other returns are calculating correctly.  The only difference is this one has a child tax credit and the others did not.  On the 1040 Worksheet, Part 1, Line 8 is not being added like it states it should for Line 8a, therefore, Line 8b is incorrect.  The only weird thing is that Line 24 on the 1040 is correct.  Just the math is wrong.  Computer not calculating refund correctly.

[MNH]

Yes, math is wrong.  

[Just-Lisa-Now-]

I couldn't tell if you meant the credit wasn't flowing over to Line 20 of the 1040 or if it was there but the math was wrong.

The line for Total Tax is Line 24 which is below the credit, so total tax would already be reduced by the $500....but if the $500 just isnt appearing on Line 20 like it should, yes that's a programming problem.

[MNH]

I checked other returns with the energy credit and this is only affecting the ones with the Child Tax Credit.  Please watch the returns to make sure it is being calculated correctly.