Why Turbo Tax Home & Business didn't offset $7500 EV Tax credit ?

Forum|Forum|3 years ago
February 13, 2023
2 replies
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I am an Uber driver. I bought a 2022 Hyundai Kona Electric on 08/30/2021 to use for Uber. when I apply for EV tax credit. Turbo Tax didn't offset the credit off my tax liability, why? Is this a glitch that need to be fixed? I have a tax liability of $9250, but for some reasons TT didn’t offset the EV credit on my tax liability as a business deduction. Anyone know this answer. please help.

TurboTax Home & Biz Windows

Best answer by JulieS

No, this is not a TurboTax problem. The EV tax credit is not refundable. This means that it only offsets income tax. Less well known is that that it doesn't offset self-employment tax either.

If you look at the second page of your 1040, your total income tax appears on line 18. Your total non-refundable credits appear on lines 19 and 20.

Line 22 is your total tax after non-refundable credits. For you that amount should be $0. On line 23, the self-employment tax is added.

If you check those lines and still have questions, just reply back to this thread.

JulieSAnswer

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KevinNg131Author

Thanks for the clarification. Is this has been like this for years? It is sort of a bummer for self employed people, isn’t it?

hlong9999

I'm also Uber driver.
As Uber driver, we can't use EV tax credit to reduce Self employment tax payment?

Is this true?

DoninGA

Employee

@hlong9999 wrote:

I'm also Uber driver.
As Uber driver, we can't use EV tax credit to reduce Self employment tax payment?

Is this true?

Yes, that is correct.

hlong9999

I'm only doing Uber for living. So I only pay Self employment tax. I can't use EV tax credit to reduce Self employment tax. I purchased EV in 2023. Is there an advantage for me that I should claim EV tax credit?
If not, maybe i just don't claim it . Thanks for your response.