I have one 1099-DIV with foreign taxes from two countries and also from ETFs which are listed as RIC on my broker's 1099-DIV. I split out the income and foreign taxes paid by all three categories into separate 1099-DIV in Turbotax. Using RIC for the ETF foreign taxes paid. I allocated each 1099-DIV to the correct country / RIC. Turbotax ignored the ETF (identified as RIC) on form 1116 which cut my credit nearly in half.
I went back and changed the country designation for the ETF to Various. Afterwards, form 1116 recognized the foreign taxes and generated a larger foreign tax credit.
The entire process of handling the foreign tax credit is unnecessairly confusing. One 1099-Div split during the foreign tax credit process should be all that is necessary.
Bigger question: Why the difference between RIC and Various in the handling of the credit? Which is correct?
