LinaJ2020
Expert Alumni

Deductions & credits

 

 

Sounds like your foreign tax credit might be subject to a limitation. 

 

The foreign tax credit is limited to the taxes you would have to pay on that foreign income in the US. So if you paid 15% in the foreign country, but are only in the 10% tax bracket in the US, you would only be able to claim 2/3 of the foreign taxes.  

 

If you can't claim a credit for the full amount of qualified foreign income taxes you paid or accrued in the year, you're allowed a carryback and/or carryover of the unused foreign income tax. 

 

Hope this helps. 

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