DaveF1006
Expert Alumni

Deductions & credits

It depends. You may not have been able to take advantage of the full amount of the credit in 2019 and 2020. As a result, there may have been a carryforward of the credit in each of those years. Let me explain how the computation of the credit works.

 

Your foreign tax credit cannot be more than your total U.S. tax liability multiplied by a fraction. The numerator of the fraction is your taxable income from sources outside the United States. The denominator is your total taxable income from U.S. and foreign sources.

 

Whatever is not claimed in those years, you may have a foreign tax carryover, which means You can carry back for one year and then carry forward for 10 years the unused foreign tax.

 

Check to see if that was the case in 2019 & 2020.

 

Please read this IRS source document on how to figure the foreign tax credit.

 

@SS62

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