@Stoaty , while it is possible that something is wrong. However, to determine if it is real , need the following information first
(a) Type of foreign source income ( active, passive etc.)
(b) country of foreign source income ( there may be treaty considerations )
(c) your world income ( on which the federal tax is based ) --- this is because form 1116 recognizes the full amount of declared foreign tax but allows only the lesser of US tax and the foreign taxes paid on the same/ doubly taxed income -- the rest of the Foreign Tax is available for carry back or forward. The US tax on this doubly taxed income ( i.e. allowable FTC ) is allocated based on foreign source income to world income ratio.
(d) additionally, if the Foreign source income is passive and generally reported on 1099, then you may be able to use "safe harbor" of up to US$300 ( i.e. lesser of actual paid and the limit amount ) and not use the form 1116 ( with its limitation )
Please answer my questions -- will circle back once I hear from you.
