Tax Credit question

Iowaggie

Joined: Jul 10, 2006

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We are looking at a purchasing a new hybrid vehicle that has a $7500 tax credit, but I'm not sure how much of that tax credit we would benefit from.

Is there a way to estimate from looking at past 1040 given our finances didn't change that much this year?

lockett93

Joined: Oct 26, 1999

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10:34a, 12/22/20

Find 2019 tax return 1040 form. Then find Total tax on line 16. It would need to be $7500 or higher to get the full credit.

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Iowaggie

Joined: Jul 10, 2006

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In reply to lockett93 • 11:12a, 12/22/20

lockett93 said:
Find 2019 tax return 1040 form. Then find Total tax on line 24. It would need to be $7500 or higher to get the full credit.

Thank you.
To be clear, you are referring to line 24 on the 2020 return, which corresponds to line 16 on the 2019 return?

nactownag

Joined: Aug 13, 2007

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1:58p, 12/22/20

And if it is not $7500 then you can look into doing a Roth conversion or harvesting gains on stocks to get the number up this year to take advantage of the tax credit.

lockett93

Joined: Oct 26, 1999

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In reply to Iowaggie • 2:07p, 12/22/20

Yes. It pulled up the new draft and I didn't notice it was the 2020