I've been using TurboTax for more than 15 years, albeit reluctantly, because despite its shortcomings and problems, it still usually works better than H&R Block's individual user product. I usually buy the Premier edition on a disc. At least this year, online electronic transfer of my data from various brokerage accounts worked flawlessly. That has not been the case in some past years.
This year I had more difficulty than in the past in completing the forms needed to claim a credit for foreign taxes paid via brokerage accounts. I had 3 different brokerage firms and in one of them two sub-accounts.
I struggled for a couple of days trying to figure out how to properly complete the Worksheets and Forms 1116 to claim a credit for foreign income taxes paid, reading the gobbly-**bleep** from the official IRS instructions and several other sources including posts on the TurboTax forum, to little avail. Then I found an Internet post by a man named Harry Sit who operates a website named "The Finance Buff" whose URL is thefinancebuff.com as a single run-together term.
Mr. Sit had posted detailed instructions for claiming the federal income tax credit for foreign income taxes paid or accrued for people using H&R Block and for people using TurboTax. Although his example is excellent, still wasn't complex enough to provide me what I needed for my situation. Because I have my investments in 3 different brokerage companies and in one there are 2 sub-accounts that have foreign based investments some of which are individual companies and others of which are RICs, Harry's single RIC holding in a single account wasn't enough help for me.
But I eventually hit upon the idea of creating one Form 1116 for my RIC accounts, entering two different RIC accounts on the same Form 1116 even though they were at different brokerages. I just had to keep the numbers entered for each of them correctly associated with the corresponding account, which I did.
Then I created an additional Form 1116 and a Worksheet for each of the two sub-accounts at the same brokerage since each had different countries involved, two different countries in each of the sub-accounts. Of course, I had to manually add up the various numbers for the total dividends and for the qualified dividends for the companies in each country and manually enter them, after I downloaded the Supplemental Information PDF from the brokerage firm.
I already had that information from the other brokers, one by mailed paper copy to me and the other via my initiating an online download.
In case future reference to that detailed data is needed, I saved a PDF copy of those 1099s from the brokerage firms and keep them in digital file form with my income tax returns. I also have a print copy.
