Re: Foreign Tax Credit Question - Other Gross Inco...
Level 12
Level 12

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@hplj1020  so are you saying that you want to take a credit for foreign taxes paid ( rather than exclude foreign earned income ) or are you saying you want to deduct the foreign taxes  and have your foreign income NOT excluded?


You do know that while a deduction of foreign tax is generally 100% ( to the extent limited by the new tax laws ( TCJA i.e. $10,000 ), foreign tax credit  allowed for the year is affected  by the ratio of foreign income to your world income -- so if you have US income  plus  foreign income , you will not get 100% credit for the year.


However, since you have entered your foreign earnings under wages  ( and not under foreign earned income and exclusion --i.e. no form 2555),  you have to enter the income as foreign income for purposes of foreign tax credit i.e. on form 1666.  You are not repeating any income  here because you do not have a form 2555 that  would have covered the same income.


Does that make sense ?

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