• Foreign Tax Credit

    From Lawrence Israel@21:1/5 to All on Wed May 12 10:15:34 2021
    As a newbie to the Form 1116 jungle, I have the following question. A person's tax is zero, but there are enough foreign taxes so that form 1116 shows that there could have been a credit, and the person wants to carry the credit forward.

    Should he fill out a zero-amount schedule 3 and enclose it with his 1116 when the taxes are filed?

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  • From Not A Clue@21:1/5 to larry.i...@gmail.com on Thu May 13 19:37:52 2021
    On Wednesday, May 12, 2021 at 10:17:37 AM UTC-4, larry.i...@gmail.com wrote:
    As a newbie to the Form 1116 jungle, I have the following question. A person's tax is zero, but there are enough foreign taxes so that form 1116 shows that there could have been a credit, and the person wants to carry the credit forward.

    Should he fill out a zero-amount schedule 3 and enclose it with his 1116 when the taxes are filed?

    Did you fully fill out the Form 1116?

    This is my general understanding of the Form 1116:

    *Conceptually*, the foreign tax credit you will get in a year depends on the amount of U.S. tax you paid on the foreign dividend income. If you paid $0 U.S. tax this year, that would mean you also paid $0 US tax on the foreign dividend. So whatever
    foreign tax was withheld would be carry forward.

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    << ------------------------------------------------------- >>
    << The foregoing was not intended or written to be used, >>
    << nor can it used, for the purpose of avoiding penalties >>
    << that may be imposed upon the taxpayer. >>
    << >>
    << The Charter and the Guidelines for submitting posts >>
    << to this newsgroup as well as our anti-spamming policy >>
    << are at www.asktax.org. >>
    << Copyright (2011) - All rights reserved. >>
    << ------------------------------------------------------- >>

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