I have foreign capital gains to report. I have paid foreign taxes on these gains and want to claim a tax credit on form 1116. I have read the instructions for form 1116 and Pub 514 in an effort to figure out the adjustment to the foreign source income that I need to report on Form 1116, line 1a. I have 2 questions:
1) the worksheet in Pub 514 refers to "US Source income". Is this the same as "foreign sourced income"? The gains are not from a US source.
2) I am confused about this statement:
>>"if the foreign sourced income was taxed at the 15% rate"
Does 15% refer to the rate the gains would be taxed in the US? Would this be something that I can see on the "Qualified Dividends and Capital Gain Tax Worksheet"?
Thanks in advance for your assistance.
