thanks @pk . Im glad you explained what the purpose of the calculations on form 1116 but its still not clear.
i see them taking the ratio of foreign income to total income but then they do a convoluted calculatino based on a % of your ITEMIZED DEDUCTIONS and then subtract that from your foreign income .
then they finally do a ratio of this number to your taxable income
then multiply this by your tax owed to get the amount of foreign tax credit for this year.
Im trying to understand the logic and intent of all this?!?
is it safe to say
1. the larger the % of your foreign income to your total income allows for a bigger foreign tax credit this year
2. the larger the % itemized deductions compared to total income, will reduce the foreign tax credit this year
am I missing anything?
