What a fiasco! TurboTax entered my foreign tax withholding 1040 on line 16 (Federal Income tax withheld from forms W-2 and 1099). This withheld income is from from foreign earned income from a foreign company that has no relation to the US any US company. It's PURE foreign income. Now check this out..
I got a letter from the IRS that wanted the following because TurboTax listed my Foreign Withholding on line 16. Here's a quote form the letter:
"To support the amount of withholding on lines 16, form 1040, submit:
* Form W-2, Wage and Tax Statement (which I did, I translated my Japanese Wage and Tax Statement and converted the YEN to USD.)
* Form 1042-S, Foreign Person's U.S. source Income Subject to withholding.
* Form 8805, Foreign Partner's Information Statement of Section 1446 Withholding Tax
* Form 8288-A, Statement of Withholding on Dispositions by Foreign Persons of the U.S. Real Property Interests.
any other U.S. withholding document."
ARE YOU KIDDING ME! I never have had to do this for all the 11 years filing with TurboTax. I always get my refund.
I noticed that this year 2019 - filing for tax year 2018 the IRS changed the 1040. The old, pre-tax year 2018, had a line 21, Other Income. List type and amount, where TurboTax correctly said: "Form 2555-Foreign Earned Inc along with the ( - ) minus number (my foreign withholding). Now with the new tax form for 2018 tax year, there's no line for "Other Income"
My guess is, since there is NO place to list my Foreign Withholding EXCEPT ON LINE 16, thus triggering the above letter from the IRS.
So, my question: Where should my Foreign Withholding be entered? If line 16, why do I get all those other forms from the IRS?
