Molly has generated general business credits over the years that have not been utilized. The amounts generated and not utilized follow:
In the current year, 2017, her business generates an additional $15,000 general business credit. In 2017, based on her tax liability before credits, she can utilize a general business credit of up to $20,000. After utilizing the carryforwards and the current year credits, how much of the general business credit generated in 2017 is available for future years?

Question

Molly has generated general business credits over the years that have not been utilized. The amounts generated and not utilized follow: ​
 In the current year, 2017, her business generates an additional $15,000 general business credit. In 2017, based on her tax liability before credits, she can utilize a general business credit of up to $20,000. After utilizing the carryforwards and the current year credits, how much of the general business credit generated in 2017 is available for future years?

Quizplus · Accepted Answer

Molly can utilize the $15,000 general business credit generated in 2017 along with the carryforward credits from previous years, which total $6,000 ($2,000 + $4,000), to offset her tax liability before credits. This leaves $1,000 (total credits available - tax liability before credits) of the $20,000 general business credit limit unused. Therefore, the unused portion of the current year credit of $1,000 can be carried forward to future years.

Molly Has Generated General Business Credits Over the Years That