DaveF1006
Employee Tax Expert

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 Yes, you may claim a foreign tax credit (FTC) paid in that country even though you did not file a return in the country. There is no requirement for you to file a return in a country to claim the Foreign Tax Credit.

 

If you receive a refund, your Foreign Tax Credit must reflect the amount paid minus the refund. This is briefly mentioned in IRS Topic 856 where the example given mentions that if you received a refund and claimed the FTC, to amend your return to reflect the difference in the credit after the refund. The scenario may be slightly difference but illustrates the principle that the the IRS will not allow the full amount of the foreign tax to be claimed without the refund. 

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