Nonrefundable Individual Tax Credits Available: Enter total available tax credits 2025

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Purpose of Schedule 3 (Form 1040) It is used to report various types of income or adjustments, including: Nonrefundable credits: Certain nonrefundable tax credits that you may be eligible for, such as the Foreign Tax Credit, Education Credits, Retirement Savings Contributions Credit, and Residential Energy Credits.
Part I of Form 1040 Schedule 3 is for nonrefundable credits, including the Foreign Tax Credit, Child and Dependent Care Credit, education credits, and more. Line 6 of Schedule 3 is for less common credits, including the Credit for the Elderly or Disabled, the adoption tax credit, and more.
A credit is an amount you subtract from the tax you owe. This can lower your tax payment or increase your refund. Some credits are refundable they can give you money back even if you dont owe any tax.
If the credits are greater than the tax you owe, theyll reduce your tax to zero, but you wont receive the balance as a refund. If you qualify for a refundable tax credit, youll receive the entire amount of the credit. If the credit exceeds the tax you owe, youll receive the remaining amount as a tax refund.
What Is a Nonrefundable Tax Credit? A nonrefundable tax credit is a reduction in the amount of income taxes that a taxpayer owes. It can reduce the amount owed to zero, but no further. In other words, the taxpayer forfeits any credit that exceeds the total amount of taxes owed.
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Tax credits, tax deductions, and itemized income tax returns are ways you may be able to reduce your taxable income or increase your income tax refund. Tax credits offset your tax liability on a dollar-for-dollar basis. Tax deductions reduce your taxable income.
For example, say that you have a $500 tax credit and a $3,500 tax bill. The tax credit would reduce your bill to $3,000. Refundable tax credits do provide you with a refund if they have money left over after reducing your tax bill to zero. As a result, theyre considered more valuable than nonrefundable tax credits.

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