Carry Forward Credits

Carry forward credits are tax benefits that businesses or individuals can apply to future tax years if they have excess credits or deductions that they couldn't fully utilize in the current year. For example, if your allowable credits exceed your tax liability this year, you can "carry forward" the unused portion to reduce your taxes in future years. This ensures that the benefits of eligible credits are not lost and can be used when you have a sufficient tax liability, improving your overall tax planning and cash flow management.