gsawyer799. Be sure you enter the foreign tax paid in Box 7 of the 1099-DIV form. To get to box 7, you must check My form has info in other boxes (this is uncommon). If the amount is $300 ($600MFJ) or less, you do not need a 1116 and this will post directly in Schedule 3 line 1 and be reflected in Line 20 of the 1040.
If it is more than $300 ($600 MFJ), you need to follow these steps.
- After you entered the amount of foreign tax paid in the 1099-DIV, followup screens will ask the amount of foreign dividend income that this tax was based from.
- Here you will enter that income under Foreign dividends received and the type of income it is, RIC or other.
- Then it will ask the foreign country. Now the basis is set for you to claim the credit.
- Next go to Federal>deductions and credits>deductions and credits>estimate and other taxes paid>Foreign Tax Credit>start or revisit
- Go ahead and complete the sections that follow. Since you already recorded your income and taxes paid, it is just a matter of navigating through this section just to generate your 1116.
- As rogge1722 said, you do not need to do this if the amount is less than $300 but In case if it was more, i wanted to give you the correct method to report.
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