To be eligible for the Foreign Tax Credit, you must be a U.S. citizen or resident alien or a U.S. nonresident alien who is a full-year resident of Puerto Rico. @rwh03001
You must have paid, accrued, or owe taxes on foreign income that is also subject to U.S. income tax. This foreign tax must be an income tax or a tax in lieu of an income tax that is imposed on you and is a legal and actual foreign tax liability.
Foreign taxes that don't qualify:
- Taxes that are refundable to you
- Taxes used to provide a subsidy to you or a relative
- Non-mandatory taxes that could have been avoided
- Taxes paid or accrued on income earned in countries designated as a State Sponsor of Terrorism or that the U.S. has severed ties or diplomatic relations
- Social security or Social Security taxes paid to countries with which the U.S. has an International Social Security (Totalization) agreement
- Taxes on foreign mineral income
- Taxes from international boycott operations
- A portion of taxes on combined foreign oil and gas income
- Taxes paid by U.S. persons controlling foreign corporations and partnerships who fail to file required information returns
Where do I enter the foreign tax credit (Form 1116) or deduction?
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