How to Prepare Tax Schedule 5695

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Prepare Tax Schedule 5695
Prepare Tax Schedule 5695

How to Prepare Tax Schedule 5695. If you made energy saving improvements to your home in the United States then you may be able to take tax credits on it. These improvements include insulation to reduce heat loss or gain, exterior windows and doors and a metal roof with pigmented coatings to reduce heat gain in the home. Follow these steps to prepare tax schedule 5695 and take advantage of these tax credits.

Select whether or not the energy efficient improvements were made on a home in the United States. If it was not then you can stop now because you don't qualify and there is no need to fill out tax schedule 5695. If you selected yes then go to line 2a.

Enter the amount you paid for insulation materials or systems that reduce heat loss or gain in your home on line 2a. Write in the cost of exterior windows including skylights and exterior doors on line 2b and 2c accordingly. Input the cost of the metal roof with the appropriate pigmented coating on line 2d.

Total up lines 2a through 2d and fill that in on line 3. Multiply that total by 10% or .10 and enter it on line 4.

Input the residential energy property costs on lines 5a through 5c. Total these lines together and enter the amount on line 6. Add lines 4 and 6 together and enter that total on line 7. If that total is less than 500 dollars then enter it on line 8 but if it isn't then enter 500 dollars.

Fill in the amount from line 46 of form 1040 or line 43 of form 1040NR on line 9. If you have any tax credits enter the total of them on line 10. Subtract line 10 from line 9 and enter it on line 11. If the total is 0 or less than you are done as you can't claim the nonbusiness energy property tax credit.

Record the costs of solar electric, solar water heating and fuel cell costs on lines 13 through 22 and multiply these by 30% or .30. Enter the kilowatt capacity of your property from line 21, multiply it by 1000 dollars and enter the total on line 23. Enter the small of the totals between lines 22 and 23 on line 24.

Add lines 16, 20 and 24 together and input on line 25 then record the amount from form 1040, line 46 or form 1040NR, line 43 on line 26.

Document the information about form 1040 or 1040NR on line 27 then subtract that total from line 26. Enter 0 on line 28 and 29 if the total is less than 0 or of it is greater enter the amount on line 28. Enter the smaller amount of line 25 or 28 on line 29. Subtract line 29 from line 25 if line 29 is less than line 25. Add together lines 12 and 29 and enter on line 31. Tax schedule 5695 is completed.

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