Deductions & credits

You can have a foreign credit  form 1116   OR   the foreign income exclusion form 2555 but not both. 

 

 

If you want to switch from the deduction to the credit:

  1. Open (continue) your return and search for foreign tax credit.
  2. Click the "Jump to" link in the search results, then keep going until you get to Do you want the deduction or the credit?
  3. Click Take a Credit and proceed.

Most people are better off taking the credit, as it's a dollar-for-dollar reduction in your taxes.

Related Information: