Sold 27 day old 2016 Model S 75D AP HW2–Only 200 miles- $85k

[SageBrush]

Then they have to hire attorneys to help them understand the substantive difference between a refundable & non-refundable credit.

I am neither a lawyer or a CPA, but I'll help you out here:

A non-refundable credit cannot lower the tax liability below zero.
Tax liability has nothing to do with the amount you owe the IRS at the end of the year ... unless you paid exactly zero tax payments during the year.

Just in case this is just a case of mixing up terms rather than you not understanding the tax code, look at this snippet from Form 1040:

Tax liability, known as 'Tax' on line 44, is the important number from which non-refundable tax credits are applied.

Example:
Your line 44 'Tax' is $7500
You have non-refundable tax credits worth $7500 + 'Z'
You have refundable tax credits worth 'Y'
You have made $'X' in prepayments

The IRS will send you a check for X+Y

--
Generic Example:
Your line 44 'Tax' is 'T'
You have non refundable tax credits worth 'NR'
You have refundable tax credits worth 'R'
You have made 'P' total pre payments

(T - NR)* - R - P
*if T - NR is negative, use zero
If the expression is negative, a refund is issued for that absolute value amount. A positive number is the amount you still owe the IRS.

Disclaimer: AMT may be the starting number to use instead of line 44.

 

[hill]

I think you & i have the same understanding
File your taxes easy, fast and affordable.

"... The Qualified Plug-in Electric Drive Motor Vehicle Credit is a non refundable credit. A non refundable credit can reduce your tax liability to 0 (zero), however it cannot result in a refund. What this means is if you qualify for a $350 credit and your tax liability is $200, you will only receive a $200 credit on your return. If your tax liability is zero you would not receive the credit at all ... "

and - that said - (dead horse) 'nuf said

.