yes you must carryback 1 year. however, if you have carryforward from 2018, a CB would be meaningless.
you could prepare an amended return to see how much FTC would be used if you can carry it back and then reduce the FTC carryforward by this amount and not file the amended return if the amount is small enough. the IRS shouldn't question the reduction without an amended return. it is common to find that the c/f is never used. under the rules for FTC the current year is used first and then the c/f.
Carryback
and Carryover
If, because of the limit on the credit, you cannot
use the full amount of qualified foreign taxes
paid or accrued in the tax year, you are allowed
a 1-year carryback and then a 10-year carryover of the unused foreign taxes.
This means that you can treat the unused
foreign tax of a tax year as though the tax were
paid or accrued in your first preceding and 10
succeeding tax years up to the amount of any
excess limit in those years. A period of less
than 12 months for which you make a return is
considered a tax year.
The unused foreign tax in each category is
the amount by which the qualified taxes paid or
accrued are more than the limit for that category. The excess limit in each category is the
amount by which the limit is more than the
qualified taxes paid or accrued for that category.
Figure your carrybacks or carryovers separately for each separate limit income category.
The 1-year carryback and 10-year carryover
do not apply to unused taxes in the GILTI category.
The mechanics of the carryback and carryover are illustrated by the following examples.
Example 1. All of your foreign income is
general category income for 2018 and 2019.
The limit on your credit and the qualified foreign
taxes paid on the income are as follows.
Your
limit
Tax
paid
Unused foreign tax (+)
or excess limit (−)
2018 $200 $100 −100
2019 $300 $500 +200
In 2019, you had unused foreign tax of $200
to carry to other years. You are considered to
have paid this unused foreign tax first in 2018
(the first preceding tax year) up to the excess
limit in that year of $100. You can then carry forward the remaining $100 of unused tax.
Example 2. All your foreign income is general category income for 2015 through 2020. In
2015, all of your foreign income was general
category income, and you had an unused foreign tax of $200. Because you had no foreign
income in 2014, you cannot carry back the unused foreign tax to that year. However, you may
be able to carry forward the unused tax to the
next 10 years. The limit on your credit and the
qualified foreign taxes paid on general category
income for 2015–2020 are as follows.
Your
limit
Tax
paid
Unused foreign tax (+)
or excess limit (−)
2015 $600 $800 +200
2016 $600 $700 +100
2017 $500 $700 +200
2018 $550 $400 −150
2019 $800 $700 −100
2020 $500 $550 + 50
You cannot carry the $200 of unused foreign
tax from 2015 to 2016 or 2017 because you
have no excess limit in any of those years.
Therefore, you carry the tax forward to 2018, up
to the excess limit of $150. The carryover reduces your excess limit in that year to zero. The
remaining unused foreign tax of $50 from 2015
can be carried to 2019. At this point, you have
fully absorbed the unused foreign tax from 2015
and can carry it no further. You can also carry
forward the unused foreign tax from 2016 and
2017.
