Here is an educated guess about what is going on. I spent most of two days using online TT and a competing product. The competitor allows easy entry of foreign income and tax credit. However, with TT in answer to the question in Form 2555 (Whose Foreign Income would you like to try and Exclude) I selected to exclude my wife's foreign income. Basically I tried for both the exclusion in 2555 as well as the tax credit in 1116! I entered the 2555 details first and then went to the 1116. Of course I had selected the Tax Credit in reply to the question whether I wanted the exclusion or credit. Somehow TT seems to be able to select the foreign tax credit automatically ignoring the exclusion data I entered.
And.... the TT refund numbers came up with an exact match with the competing product. So it is getting reflected in the calculation once you choose the foreign income exclusion in 2555 as well as the credit in 1116.
As long as I selected Neither of Us to the question Whose Foreign Income would you like to try and Exclude, I ran into all the problems described here.
People can try this and see whether it works. Good luck.
