2023 Instructions for Form 5695

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2023

Instructions for Form 5695

Residential Energy Credits

Department of the Treasury

Internal Revenue Service

Section references are to the Internal Revenue Code unless

otherwise noted.

General Instructions

Future Developments

For the latest information about developments related to Form 5695

and its instructions, such as legislation enacted after they were

published, go to IRS.gov/Form5695.

What’s New

Residential clean energy credit. The residential clean energy

credit added a credit for qualified battery storage technology. Battery

storage technology costs are allowed for the residential clean energy

credit for expenses paid after December 31, 2022. See

Qualified

battery storage technology costs, later, for details.

Biomass fuel property costs are no longer allowed for the

Residential Clean Energy Credit for property placed in service after

December 31, 2022.

Energy efficient home improvement credit. The energy efficient

home improvement credit is now divided into two sections to

differentiate between qualified energy efficiency improvements and

residential energy property expenditures.

For the energy efficient home improvement credit, the lifetime

limitation has been replaced by an annual credit limit. A 30% credit,

up to a maximum of $1,200, may be allowed for:

•

Insulation material or air sealing material or systems,

•

Exterior doors,

•

Windows and skylights,

•

Central air conditioners,

•

Natural gas, propane or oil water heaters,

•

Natural gas, propane or oil furnaces or hot water boilers,

•

Improvements or replacement of panelboards, subpanelboards,

branch circuits or feeders, and

•

Home energy audits.

The limits for each category of these items that qualify for a credit is

discussed later in Section A—Qualified Energy Efficiency

Improvements.

Heat pumps and heat pump water heaters, biomass stoves and

biomass boilers have a separate annual credit limit of $2,000 with no

lifetime limitation, which replaces the prior lifetime limitation of $500.

For additional information and Frequently Asked Questions about

energy efficient home improvements and residential clean energy

property credits, see Fact Sheet 2022-40 at

https://www.irs.gov/pub/

taxpros/fs-2022–40.pdf.

Reminders

Residential energy efficient property credit. The residential

energy efficient property credit is now the residential clean energy

credit. The credit rate for property placed in service in 2022 through

2032 is 30%.

Energy efficient home improvement credit. The nonbusiness

energy property credit is now the energy efficient home improvement

credit. The credit is extended to property placed in service through

December 31, 2032.

Purpose of Form

Use Form 5695 to figure and take your residential energy credits.

The residential energy credits are:

•

The residential clean energy credit, and

•

The energy efficient home improvement credit.

Also use Form 5695 to take any residential clean energy credit

carryforward from 2022 Form 5695 or to carry the unused portion of

the residential clean energy credit to 2024.

Who Can Take the Credits

You may be able to take the credits if you made energy saving

improvements to your home located in the United States in 2023.

Home. A home is where you lived in 2023 and can include a house,

houseboat, mobile home, cooperative apartment, condominium, and

a manufactured home that conforms to Federal Manufactured Home

Construction and Safety Standards.

You must reduce the cost basis of your home if a residential

energy credit is allowed for any expense for any property. The

increase in the basis of the property that would result from the

expenses will be reduced by the amount of the allowed credit.

Main home Your main home is generally the home where you live

most of the time. A temporary absence due to special

circumstances, such as illness, education, business, military service,

or vacation, won't change your main home

Costs. For purposes of both credits, costs are treated as being paid

when the original installation of the item is completed, or, in the case

of costs connected with the reconstruction of your home, when your

original use of the reconstructed home begins. For purposes of the

residential clean energy credit only, costs connected with the

construction of a home are treated as being paid when your original

use of the constructed home begins. If less than 80% of the use of

an item is for nonbusiness purposes, only that portion of the costs

that is allocable to the nonbusiness use can be used to determine

either credit.

The residential clean energy credit (Part I) is available for

both existing homes and homes being constructed. The

energy efficient home improvement credit (Part II) is only

available for existing homes.

IRS guidance issued with respect to the energy credit under

section 48, such as Notice 2018-59 and Notice 2021-41,

does not apply to the residential energy credits.

Association or cooperative costs. If you are a member of a

condominium management association for a condominium you own

or a tenant-stockholder in a cooperative housing corporation, you

are treated as having paid your proportionate share of any costs of

such association or corporation.

If you received a subsidy from a public utility for the

purchase or installation of an energy conservation product

and that subsidy wasn't included in your gross income, you

must reduce your cost for the product by the amount of that subsidy

before you figure your credit. This rule also applies if a third party

(such as a contractor) receives the subsidy on your behalf.

Residential Clean Energy Credit

(Part I)

If you made energy saving improvements to more than one home

that you used as a residence during 2023, enter the total of those

costs on the applicable line(s) of one Form 5695. For qualified fuel

cell property, see Lines 7a and 7b, later.

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You may be able to take a credit of 30% of your costs of qualified

solar electric property, solar water heating property, small wind

energy property, geothermal heat pump property, battery storage

technology, and fuel cell property. Include any labor costs properly

allocable to the onsite preparation, assembly, or original installation

of the residential clean energy property and for piping or wiring to

interconnect such property to the home. The credit amount for costs

paid for qualified fuel cell property is limited to $500 for each

one-half kilowatt of capacity of the property.

Qualified solar electric property costs. Qualified solar electric

property costs are costs for property that uses solar energy to

generate electricity for use in your home located in the United

States. No costs relating to a solar panel or other property installed

as a roof (or portion thereof) will fail to qualify solely because the

property constitutes a structural component of the structure on which

it is installed. Some solar roofing tiles and solar roofing shingles

serve the function of both traditional roofing and solar electric

collectors, and thus serve functions of both solar electric generation

and structural support. These solar roofing tiles and solar roofing

shingles can qualify for the credit. This is in contrast to structural

components such as a roof's decking or rafters that serve only a

roofing or structural function and thus do not qualify for the credit.

The home doesn't have to be your main home.

Qualified solar water heating property costs. Qualified solar

water heating property costs are costs for property to heat water for

use in your home located in the United States if at least half of the

energy used by the solar water heating property for such purpose is

derived from the sun. No costs relating to a solar panel or other

property installed as a roof (or portion thereof) will fail to qualify

solely because the property constitutes a structural component of

the structure on which it is installed. Some solar roofing tiles and

solar roofing shingles serve the function of both traditional roofing

and solar electric collectors, and thus serve functions of both solar

electric generation and structural support. These solar roofing tiles

and solar roofing shingles can qualify for the credit. This is in

contrast to structural components such as a roof's decking or rafters

that serve only a roofing or structural function and thus do not qualify

for the credit. To qualify for the credit, the property must be certified

for performance by the nonprofit Solar Rating Certification

Corporation or a comparable entity endorsed by the government of

the state in which the property is installed. The home doesn't have to

be your main home.

Qualified small wind energy property costs. Qualified small

wind energy property costs are costs for property that uses a wind

turbine to generate electricity for use in connection with your home

located in the United States. The home doesn't have to be your main

home.

Qualified geothermal heat pump property costs. Qualified

geothermal heat pump property costs are costs for qualified

geothermal heat pump property installed on or in connection with

your home located in the United States. Qualified geothermal heat

pump property is any equipment that uses the ground or ground

water as a thermal energy source to heat your home or as a thermal

energy sink to cool your home. To qualify for the credit, the

geothermal heat pump property must meet the requirements of the

Energy Star program that are in effect at the time of purchase. The

home doesn't have to be your main home.

Qualified battery storage technology costs. Qualified battery

storage technology costs are costs for battery storage technology

that is installed in connection with your home located in the United

States and has a capacity of at least 3 kilowatt hours.

Qualified fuel cell property costs. Qualified fuel cell property

costs are costs for qualified fuel cell property installed on or in

connection with your main home located in the United States.

Qualified fuel cell property is an integrated system comprised of a

fuel cell stack assembly and associated balance of plant

components that converts a fuel into electricity using

electrochemical means. To qualify for the credit, the fuel cell property

must have a nameplate capacity of at least one-half kilowatt of

electricity using an electrochemical process and an electricity-only

generation efficiency greater than 30%.

Costs allocable to a swimming pool, hot tub, or any other

energy storage medium that has a function other than the

function of such storage don't qualify for the residential clean

energy credit.

Joint occupancy. If you occupied your home jointly with someone

other than your spouse, each occupant must complete their own

Form 5695. To figure the credit, the maximum qualifying costs that

can be taken into account by all occupants for qualified fuel cell

property costs is $1,667 for each one-half kilowatt of capacity of the

property. The amount allocable to you for qualified fuel cell property

costs is the lesser of:

1. The amount you paid, or

2. The maximum qualifying cost of the property multiplied by a

fraction. The numerator is the amount you paid and the denominator

is the total amount paid by you and all other occupants.

These rules don't apply to married individuals filing a joint return.

Example. Ava owns a house with Bruce where they both reside.

In 2023, they installed qualified fuel cell property at a cost of $20,000

with a kilowatt capacity of 5. Ava paid $12,000 towards the cost of

the property and Bruce paid the remaining $8,000. The amount to be

allocated is $16,670 ($1,667 x 10 (kilowatt capacity x 2)). The

amount of cost allocable to Ava is $10,002 ($16,670 x

$12,000/$20,000). The amount of cost allocable to Bruce is $6,668

($16,670 x $8,000/$20,000).

Energy Efficient Home Improvement

Credit

(Part II)

Section A—Qualified Energy Efficiency

Improvements

You may be able to take a credit equal to 30% of the sum of:

1. The amount paid or incurred for qualified energy efficiency

improvements installed during 2023,

2. The amount of the residential energy property costs paid or

incurred in 2023, and

3. The amount paid or incurred for home energy audits during

2023.

However, this credit is limited as follows.

•

A total combined credit limit of $1,200 for qualified energy

property.

•

A credit limit of $600 for any qualified energy property item.

•

A combined credit limit of $600 for all exterior windows and

skylights.

•

A credit limit of $250 for any qualifying exterior door and $500

total for all qualifying exterior doors.

•

A combined credit limit of $2,000 for heat pump and heat pump

water heaters; biomass stoves and boilers.

•

A credit limit of $150 for home energy audits.

Subsidized energy financing. Any amounts provided for by

subsidized energy financing can't be used to figure the energy

efficient home improvement credit. This is financing provided under

a federal, state, or local program, the principal purpose of which is to

provide subsidized financing for projects designed to conserve or

produce energy.

Qualified energy efficiency improvements. Qualified energy

efficiency improvements are the following building envelope

components installed on or in your main home that you owned

during 2023 located in the United States if the original use of the

component begins with you, the component can be expected to

remain in use at least 5 years, and the component meets certain

energy standards.

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•

Any insulation material or system and air sealing material or

system that is specifically and primarily designed to reduce heat loss

or gain of a home when installed in or on such a home.

•

Exterior windows and skylights.

•

Exterior doors.

For purposes of figuring the credit, don't include amounts paid for

the onsite preparation, assembly, or original installation of the

building envelope component.

To qualify for the credit, qualified energy efficiency

improvements must meet certain energy efficiency

requirements. See

Line 18a through Line 20a, later, for

details.

Section B—Residential Energy Property

Expenditures

Residential energy property costs are costs of new qualified energy

property that is installed on or in connection with a home that you

used during 2023 located in the United States. Include any labor

costs properly allocable to the onsite preparation, assembly, or

original installation of the energy property. Qualified energy property

is any of the following.

•

Certain electric or natural gas heat pump water heaters; electric

or natural gas heat pumps; central air conditioners; and natural gas,

propane, or oil water heaters.

•

Natural gas, propane, or oil furnaces and hot water boilers.

•

Certain biomass stoves and biomass boilers.

•

Certain improvements or replacements of panelboards,

subpanelboards, branch circuits, or feeders.

To qualify for the credit, qualified energy property must meet

certain energy efficiency requirements. See Line 22a

through Line 25a and Lines 29a Through 29e, later, for

details.

Home energy audits. Home energy audits costs are costs for an

inspection of your main home located in the United States and a

written report was prepared by a certified home energy auditor that:

1. Identifies the most significant and cost-effective energy

efficiency improvements for the home, including an estimate of the

energy and cost savings for each improvement; and

2. Is conducted and prepared by a certified home energy

auditor.

To qualify for the credit, home energy audits must meet

certain requirements. See Lines 26a Through 26c, later, for

details.

Joint ownership of qualified property. If you and a neighbor

shared the cost of qualifying property to benefit each of your main

homes, both of you can take the energy efficient home improvement

credit. You figure your credit on the part of the cost you paid. The

limit on the amount of the credit applies to each of you separately.

Married taxpayers with more than one home. If both you and

your spouse owned and lived apart in separate main homes, the limit

on the amount of the credit applies to each of you separately. If you

are filing separate returns, both of you would complete a separate

Form 5695. If you are filing a joint return, figure your energy efficient

home improvement credit as follows.

1. Complete lines 17a through 30 of a separate Form 5695 for

each main home.

2. Figure the amount to be entered on line 30 of both forms and

enter the combined amount on line 30 of one of the forms.

3. On the dotted line to the left of line 30, enter “More than one

main home.” Then, complete the rest of this form.

4. Attach both forms to your return.

Joint occupancy. If you owned your home jointly with someone

other than your spouse, each owner must complete their own Form

5695. To figure the credit, enter the amounts you paid for these items

CAUTION

on the appropriate lines of Form 5695, Part II. The amount allocable

to you is the smaller of:

1. The amount you paid, or

2. The qualifying credit of the property multiplied by a fraction.

The numerator is the amount you paid and the denominator is the

total amount paid by you and all other owners.

The credit limit for each property is as follows.

•

$1,200 for insulation or air sealing material system.

•

$250 for one exterior door and $500 for all exterior doors.

•

$600 for windows.

•

$600 for central air conditioners.

•

$600 for natural gas, propane, or oil water heaters.

•

$600 for natural gas, propane, or oil furnace or hot water boilers.

•

$600 for improvements or replacements of panelboards,

subpanelboards, branch circuits, or feeders.

•

$150 for home energy audits.

•

$2,000 for heat pumps and heat pump water heaters; biomass

stoves and biomass boilers.

Specific Instructions

Part I

Residential Clean Energy Credit

Before you begin Part I.

Figure the amount of the credits shown in the credit limitation

worksheet if you take those credits on your return.

Include on lines 1 through 4, 5b, and 8, any labor costs

properly allocable to the onsite preparation, assembly, or

original installation of the property and for piping or wiring to

interconnect such property to the home.

In the section above line 1, enter the complete address of the

home where you installed the qualified residential clean energy

property or technology associated with lines 1 through 4 and 5b. If

you made improvements to more than one home, list the complete

address of the home with the greatest total cost in the section above

line 1. Then, attach a statement listing the additional addresses to

Form 5695.

Line 1

Enter the amounts you paid for qualified solar electric property. See

Qualified solar electric property costs, earlier.

Line 2

Enter the amounts you paid for qualified solar water heating

property. See Qualified solar water heating property costs, earlier.

Line 3

Enter the amounts you paid for qualified small wind energy property.

See Qualified small wind energy property costs, earlier.

Line 4

Enter the amounts you paid for qualified geothermal heat pump

property. See Qualified geothermal heat pump property costs,

earlier.

Lines 5a and 5b

To qualify for the credit, the qualified battery storage technology

must have a capacity of at least 3 kilowatt hours.

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If the qualified battery storage technology has a capacity of 3

kilowatt hours or greater, then check the “Yes” box, enter the

amounts you paid for qualified battery storage technology on line 5b.

If you check the “No” box, you can't include any battery storage

technology costs on line 5b. See Qualified battery storage

technology costs, earlier.

Lines 7a and 7b

Any qualified fuel cell property costs must have been for your main

home located in the United States. See Main home, earlier. If you

check the “Yes” box, enter the full address of your main home during

2023 on line 7b.

If you and your spouse are filing jointly and you each have

different main homes with qualified fuel cell property costs, provide

on line 7b the address of your main home. Add a statement

providing the address of your spouse's main home. You and your

spouse should add your qualified fuel cell property costs together on

line 8 of one Form 5695.

If you check the “No” box, you can't include any fuel cell property

costs on line 8.

Line 8

Enter the amounts you paid for qualified fuel cell property. See

Qualified fuel cell property costs, earlier.

Line 14

Complete the following worksheet to figure the amount to enter on

line 14.

Residential Clean Energy Credit Limit

Worksheet—Line 14

1. Enter the amount from Form 1040,

1040-SR, or 1040-NR, line 18 .. 1.

2. Enter the total of the following

credit(s)/adjustment(s) if you are

taking the credit(s)/adjustment(s) on

your 2023 income tax return:

+ Negative Form 8978 Adjustment,

Schedule 3 (Form 1040), line 6l .

+ Foreign Tax Credit, Schedule 3

(Form 1040), line 1 ..........

+ Credit for Child and Dependent

Care Expenses, Schedule 3 (Form

1040), line 2 ...............

+ Credit for the Elderly or the

Disabled, Schedule R (Form 1040),

line 22 ...................

+ Nonrefundable Education Credits,

Schedule 3 (Form 1040), line 3 ..

+ Retirement Savings Contributions

Credit, Schedule 3 (Form 1040),

line 4 ....................

+ Energy efficient home

improvement credit, Form 5695,

line 32* ..................

+ Credit for previously owned clean

vehicles, Form 8936, line 18 ....

+ New Clean Vehicle Credit,

Personal use part, Form 8936,

line 13 ...................

+ Child tax credit or credit for other

dependents, Form 1040, 1040-SR,

or 1040-NR, line 19* .........

+ Mortgage Interest Credit, Form

8396, line 9 ...............

+ Adoption Credit, Form 8839,

line 16 ...................

+ Carryforward of the District of

Columbia First-Time Homebuyer

Credit, Form 8859, line 3 ......

Note. Enter the total of the

preceding credit(s)/adjustment(s),

only if allowed and taken on your

2023 income tax return. Not all

credits/adjustments are available for

all years nor for all filers. See the

instructions for your 2023 income tax

return. 2.

3. Subtract line 2 from line 1. Also enter

this amount on Form 5695, line 14. If

zero or less, enter -0- on Form 5695,

lines 14 and 15 ............. 3.

* Include the amount in the instructions for Schedule 8812 (Form

1040), Credit Limit Worksheet B, line 14, instead of the amount from

Form 1040, 1040-SR, or 1040-NR, line 19, if the instructions for

Schedule 8812 (Form 1040) direct you to complete Credit Limit

Worksheet B.

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Manufacturer’s certification. For purposes of taking the credit,

you can rely on the manufacturer’s certification, in writing, that a

product is qualifying property for the credit. Don't attach the

certification to your return. Keep it for your records.

Line 16

If you can't use all of the credit because of the tax liability limit (that

is, line 14 is less than line 13), you can carry the unused portion of

the credit to 2024.

File this form even if you can't use any of your credit in 2023.

Part II

Energy Efficient Home Improvement

Credit

Section A—Qualified Energy Efficiency

Improvements

Lines 17a Through 17e

Line 17a. To qualify for the credit, any qualified energy efficiency

improvements must have been for your main home located in the

United States. See Main home, earlier. If you check the “No” box,

you can't take the energy efficient home improvement credit.

Line 17b. To qualify for the credit, you must be the original user of

the qualified energy efficiency improvements. If you check the “No”

box, you can't take the energy efficient home improvement credit.

Line 17c. To qualify for the credit, the components must be

reasonably expected to remain in use for at least 5 years on your

main home located in the United States. If you check the “No” box,

you can't take the energy efficient home improvement credit.

Line 17d. Enter the complete address of your main home during

2023. You can only claim the energy efficient home improvement

credit on one main home.

Line 17e. You cannot claim the credit for expenses related to the

construction of a new home. If you are claiming the credit only for

expenses for qualified improvements to an existing home or for an

addition or renovation to an existing home, check the “No” box. If the

qualified improvements for which you are seeking to claim the credit

are related to the construction of a new home, check the “Yes” box. If

you check the “Yes” box, skip lines 18a through 20b.

Lines 18a and 18b

Note. A reference to the IECC is a reference to the International

Energy Conservation Code as in effect (with supplements) on

January 1, 2021 for components placed in service during 2023.

Don't include on lines 18a, 19a, 19c, and 20a any amounts

paid for the onsite preparation, assembly, or original

installation of the components.

Line 18a. Enter the amounts you paid for any insulation material or

air sealing material or system (including any vapor retarder or seal to

limit infiltration) that is specifically and primarily designed to reduce

the heat loss or gain of your home when installed in or on such home

and meets the criteria established by the IECC.

Don't enter more than $1,200 on line 18b.

A component isn't specifically and primarily designed to

reduce the heat loss or gain of your home if it provides

structural support or a finished surface (such as drywall or

siding) or its principal purpose is to serve any function unrelated to

the reduction of heat loss or gain.

CAUTION

Lines 19a Through 19e

Line 19a. Enter the amounts you paid for the most expensive

exterior door that meets the Energy Star program requirements.

Don't enter more than $250 on line 19b.

Line 19c. Enter the amounts you paid for all other qualifying exterior

doors in 2023.

Don't enter more than $500 on line 19e.

Line 20a

Enter the amounts you paid for exterior windows and skylights that

meet Energy Star certification requirements.

Don't enter more than $600 on line 20b.

Manufacturer’s certification. For purposes of taking the credit,

you can rely on a manufacturer’s certification in writing that a building

envelope component is an eligible building envelope component.

Don't attach the certification to your return. Keep it for your records.

Section B—Residential Energy Property

Expenditures

Lines 21a Through 21c

Line 21a. To qualify for the credit, any qualified energy property

installed on or in your home must be located in the United States. If

you check the “No” box, you can't take the energy efficient home

improvement credit for your residential energy property costs.

Line 21b. To qualify for the credit, the qualified energy property

must have been originally placed in service by you. If you check the

“No” box, you can't take the energy efficient home improvement

credit for your residential energy property costs.

Line 21c. Enter the full address of each home where you installed

qualified residential energy property.

Include on lines 22a, 23a, 24a, 25a, 29a, 29b, and 29c any

labor costs properly allocable to the onsite preparation,

assembly, or original installation of the property.

Line 22a

Enter the amounts you paid for central air conditioners that achieve

the highest efficiency tier that has been established by the

Consortium for Energy Efficiency (CEE) that is in effect as of the

beginning of the calendar year in which the property is placed in

service.

Don't enter more than $600 on line 22b.

Line 23a

Enter the amounts you paid for natural gas, propane, or oil water

heaters that achieve the highest efficiency tier established by the

CEE that is in effect as of the beginning of the calendar year in which

the property is placed in service.

Don't enter more than $600 on line 23b.

Line 24a

Enter the amounts you paid for a natural gas, propane, or oil furnace

or hot water boilers that achieve the highest efficiency tier

established by the CEE that is in effect as of the beginning of the

calendar year in which the property is placed in service. In addition,

oil furnaces and hot water boilers placed in service after December

31, 2022, and before January 1, 2027, must meet the 2021 Energy

Star efficiency criteria and be rated by the manufacturer for use with

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fuel blends at least 20% of the volume of which consists of an

eligible fuel.

Line 25a

Enter the amounts you paid for improvements or replacement of

panelboards, subpanelboards, branch circuits, or feeders that were

installed in a manner consistent with the National Electric Code,

have a load capacity of at least 200 amps, and were installed with

qualified energy efficiency improvements or qualified energy

property.

Don't enter more than $600 on line 25b.

Lines 26a Through 26c

Line 26a. To qualify for the credit, a home energy audit must have

included an inspection of your main home located in the United

States and a written report prepared by a certified home energy

auditor. If you check the “No” box, you can't claim the home energy

audit credit.

Line 26b. Enter the amounts you paid for home energy audits in

2023.

Don’t enter more than $150 on line 26c.

Note. For home energy audits conducted between January 1, 2023,

and December 31, 2023, the auditor is not required to be a certified

qualified home energy auditor.

Beginning January 1, 2024, home energy audits must be

performed by a Qualified Home Energy Auditor or under the

supervision of a Qualified Home Energy Auditor. The

Qualified Home Energy Auditor must be certified by a Qualified

Certification Program at the time of the home energy audit.

Lines 29a Through 29e

Line 29a. Enter the amounts you paid for electric or natural gas

heat pumps that achieve the highest efficiency tier established by

the CEE that is in effect as of the beginning of the calendar year in

which the property is placed in service.

Line 29b. Enter the amounts you paid for electric or natural gas

heat pump water heaters that achieve the highest efficiency tier

established by the CEE that is in effect as of the beginning of the

calendar year in which the property is placed in service.

Line 29c. Enter the amounts you paid for biomass stoves and

biomass boilers that have a thermal efficiency rating of at least 75%

(measured by the higher heating value of the fuel).

Don’t enter more than $2,000 on line 29e.

Manufacturer’s certification. For purposes of taking the credit,

you can rely on a manufacturer’s certification in writing that a product

CAUTION

is qualified energy property. Don't attach the certification to your

return. Keep it for your records.

Line 31

Complete the worksheet below to figure the amount to enter on

line 31.

Energy Efficient Home Improvement Credit Limit

Worksheet—Line 31

1. Enter the amount from Form 1040,

1040-SR, or 1040-NR, line 18 .. 1.

2. Enter the total of the following

credit(s)/adjustment(s) if you are

taking the credit(s)/adjustment(s) on

your 2023 income tax return:

+ Negative Form 8978 Adjustment,

Schedule 3 (Form 1040),

line 6l ...................

+ Foreign Tax Credit, Schedule 3

(Form 1040), line 1 ..........

+ Credit for Child or Dependent Care

Expenses, Schedule 3 (Form 1040),

line 2 ....................

+ Credit for the Elderly or the

Disabled, Schedule R (Form 1040),

line 22 ...................

+ Nonrefundable Education Credits,

Schedule 3 (Form 1040), line 3 ..

+ Retirement Savings Contributions

Credit, Schedule 3 (Form 1040),

line 4 ....................

Note. Enter the total of the

preceding credit(s)/adjustment(s),

only if allowed and taken on your

2023 income tax return. Not all

credits/adjustments are available for

all years nor for all filers. See the

instructions for your 2023 income

tax return. 2.

3. Subtract line 2 from line 1. Also

enter this amount on Form 5695,

line 31. If zero or less, enter -0- on

Form 5695, lines 31 and 32 .... 3.

Instructions for Form 5695 (2023)