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Just make sure he had some foreign income, details of which should be buried in the brokerage statement somewhere. The credit only applies to foreign income so the carryover will reduce the US taxes on that income. I had a client with several thousand in FT credit carryovers who kept questioning me about why I wasn't applying them. He had liquidated all his mutual funds and had no foreign income, so the carryover was wasted after ten years.

This was discussed on the TaxTalk io group a couple years ago. Pretty much everyone agreed the credit was taken after the system was hooked up and functional.

I took the credit in the year installed even though the electric company didn't hook it up until January.

But that does not tell us anything. What authoritative cites did they refer to? Section 25D(e)(8) (A) states : In general Except as provided in subparagraph (B), an expenditure with respect to an item shall be treated as made when the original installation of the item is completed.” That is in contrast to section 48 for a commercial energy credit which specifically states the property must be placed in service. While there might be some uncertainty as to the definition of “installation”, obviously there is a lower standard for claiming a residential credit vs a commercial credit where the term “placed in service” is used. Without researching the legislative history, it appears congress intended to give individuals a greater incentive to go solar by setting a lower standard. In fact, section 25D drops the bar a notch further for the residential credit in stating an “expenditure” is made when installation is completed; meaning the credit is allowed if the installation is completed in year one while payment is made in year two. In regards to the term “installation”, let’s say you put a new engine in a semi-truck and the work was completed by December 31,2022. However, the truck was not licensed and permitted until January of the next year. Depreciation on the engine cannot begin until placed in service in 2023. Now what if tax code said depreciation could begin when “installation is completed”, would you tell client no depreciation until ready and available for service? Or would you start depreciation in year engine was physically installed instead of waiting until the next year when permits were obtained? Getting back to OP, I would have this discussion (and document it) with client and let them decide if they met the definition of “installation”.

Wasn't that nice of them to take that away from the Seniors who are working to supplement their Social Security? That was one of the nicest perks about last year.

This was my thinking also. "Since the "post-card" fiasco left us all this blank space at the bottom, let's break out all the "wage" types on separate lines." They just forgot to include the various w/h entries in the fix.

Yes, I saw the difference in the numbered codes, but the issue really seems to be the same thing with the withholding exceeding the total income. I think the only difference in the error codes is that the line numbers on the 1040 have changed since the "05" error was in use and was the reason I mentioned adding the $1.

Thanks Judy, I saw the same things you're saying for error code F1040-071-05, but not for F1040-071-07. A subsequent "startpage" search found a Taxslayer help page that said - paper file. But the Drake error page leads me to believe that once the IRS fixes the problem, it can be resubmitted. The cap gain solution, (I saw), didn't make much sense. It said to do as you suggested, but then also said to enter another $1 on one of the schedules - I assume to zero it out. I just would like to see a place @ irs.gov that would address when this fix is/was made.

MANY thanks Abby as it looks like it will give them the credit. The form is a real labyrinth !

Multitasking means doing many things poorly

I have a relative who took the credit when it was installed. Just needed an electrician to hook it up to the grid. That last step took 18 months because of installation problems the electrician found. As was said previously about others, the guy who sold it moved onto another company and the company they bought from sold to another so nobody thought they were responsible. When the second company wanted to sell to a third, it was put on hold when they figured out this relative wasn't making payments (and nobody was sending them to collections) and demanded to know why. Poof - they got it fixed.