Thank you very much for your reply, tagteam and pk
I apologize that I should have explained better about my situation.
(a) you a US person ( citizen/ Green Card / Resident for tax purposes ) live in the USA --- Correct, I am a green card holder, I am a Japanese citizen
(b) You own land in a foreign country ( which country ? ) that you rent out , through management services --- Correct, in Japan,
(c) your total income from this rental is US$5000 , which incurs Prop Tax of US$1500 and management fees of US$1000. Thus your net income from this rental is US2500 and which you recognize on schedule-E --- Correct, (it's not important here but Prop tax $1000, and Management fees $500, so Total Expenses is $1500 and Total net profit is $3500)
(d) you pay NIL/None income tax on this rental to a foreign country. --- Correct, $0 foreign tax paid
Additional information：
(e) 1099 INT : $65 Foreign Tax Paid to Japan on earned interest of $320 from Bank accounts in Japan
(f) 1099 DIV : Total of $50 Foreign Tax Paid to 4 different countries (Canada, Taiwan, Japan, S.Africa, Marshall Island) and also Various on
dividends and capital gain from ETFs and Stocks.
These Form 1099 DIVs from U.S Brokerage such as Vanguard, TDAmeritrade, JPMorgan, and Apex Cleaning
I was working on Form 1116 with 1099 INT(e) and 1099 DIV (f), and when I came to Part I, 3d "Gross foreign source income", I suddenly wondered if I should include the income from land rent or not. After reading the IRS instructions, and Pub 514, I became even more confused. And I started to wonder if I should include it fully in form 1116 even no foreign taxes generated. I decided to ask for help here.
I've never had the intention of reporting any part of information of the land rent in any part of Form1116 except reporting it in Schedule E since I paid no foreign taxes on it, of course no receipt of credit. I haven't reported it in 1116 in the past 2 years since this rent land income generated.
If you can share your knowledge or what you think, that would be very appreciated. Thank you!
