Your “Foreign Tax Credit Carryover” is actually something separate from AMT, although if you otherwise have “Alternative Minimum Tax” going on, it’s certainly relevant. Assuming you do not, it’s just a matter of carrying the unused (extra) part of your foreign tax credit amount (see this discussion) forward through the years (assuming it couldn’t be used last year).
Egoldrich, we always like to give our more pleasant customers some info that improves their tax bottom line, but in this case that may not be possible, at least in this specific area(!). One reason they allow you to carry the Foreign Tax Credit forward so many years is that it’s difficult to use, and many people never do. Since it results from paying tax to a country with higher rates than the U.S. (and only getting to use the part equal to what the U.S. tax would be on that amount of income), continuing to earn income from the same high-taxed country normally only increases your carryover from year to year, with it never rendering an actual tax benefit.
But as long as you continue to use TurboTax (and we certainly hope you do!), the program will be tracking your carryover and applying it in the event that you eventually have foreign tax paid to a country with a lower rate than the U.S. I hope this was clear, egoldrich, and thank you also!
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