pk
Level 15
Level 15

Deductions & credits

@revbling , first US tax filings and reconciliations are per year -- thus  for example  --

your foreign wages /earnings for 2018  was 210,000 and you were able to exclude 109,000  ( dummy figure for the max for the year). This would mean that foreign taxes on 101,000 that you paid to Germany may be eligible  for tax credit against  US taxes on the same  gross income.  Say now  the US tax on this 101,000 is 20,000 while Germany  withheld 25,000 on the same  income but ultimately settled for 21,000 --- in this case you either wait and file the USA  return when the German return is finalized  ( but generally not past the end of the year 2019) or  file US return with provisional German tax figure and then  file an amended 2018 with the final German Tax figure.  But you cannot  include  the final figure in 2019 as an adjustment.

And -- foreign taxes paid is recognized  dollar for dollar, the allowable amount for the year is limited by the  US tax liability.  Un-allowed amounts can be carried back one year and forward for 10 years but ONLY when there is foreign earnings  are present.

Does this make sense ?   Is there more I can do for you ?