Mike9241 and Critter 3 - thanks for your responses.
I had already read form 1116 instructions including the instruction for line 3e.
However I am not able to understand how the amount on Form 1116 line 3e can be greater than the amount on Form 1040 line 9 which is total income. This total income includes foreign source income - foreign capital gain as well as foreign bank account interest. The foreign capital gain included on 1040/line 9 is before any adjustments are applied to it on 1116/line 1a. Line 1a on form 1116 is a reduced number after applying the adjustments, however, the foreign source capital gain included in 1040/line 9 is the full amount before any reductions. I don't have any losses, so the amounts are not reduced by any losses either.
Since Form 1040 line 9 is Total Income, it is the total income amount before any deductions are applied such as standard deduction.
How did Turbotax calculate 1116/line 3e to be greater than 1040/line 9?
