This is bananas.
I am a US citizen living abroad. I used the ONLINE Turbotax software last year (2021) and did not have a problem filing the tax return. For 2022, I am trying to use downloaded Turbotax Deluxe 2022 software for Windows desktop and don't understand why I am being forced to include a Form 2555 (I did not file this form last year). All of my income is foreign and I paid tax at source in the foreign country.
I do not want to use the Foreign Earned Income Exclusion (FEIE), I simply want to use a foreign tax credit (based on the taxes I already paid). Based on this objective should the program not calculate the taxpayer's US tax liability via 1040 and then post-completion of 1116, apply any tax credit to reduce that liability? What does 2555 have to do with anything?
Because the program is forcing me to use 2555 (on the assumption I want to use the FEIE, it is doubling my income (1040 income on 1a is being added to Foreign Income on 2555), taxes paid is not doubling and so I have a tax liability even though I should not: (1) I paid full freight income taxes in the UK plus I even have a FTC credit carryover from last year).
There is something messed up in this program. Anyone face this issue? Any resolution?
