Hi PK,
Apologies for the absence. Thanks for doing the dummy trial that you did. I think you are saying entering the foreign income as Wages is an error. At the bottom you suggest entering income on Schedule C. If I add the Schedule C form into Turbotax it comes up as a form for sole proprietors. You don't mean that do you? Why would we need to utilize that form in order to complete the tax return? The FICA and SECA taxes were not a factor in last year's tax return. I know this because I am looking at last year's tax return and there is no Schedule C. Reminder: last year's tax return was created using Turbotax Online. It spat out 1040 including Schedules 1, 2, and 3, Schedule B, Form 1116 regular and AMT, Form 6251....no Schedule C).
I think there is a fundamental flaw with this software. You should be able to enter a gross income (wages) number which generates a US tax liability. You should then be able to go to 1116 and enter the same number as Gross Foreign Source Income (the form has a factor that allows you to show Gross Foreign Source Income is same as Gross Income from all Sources.) You should then enter the foreign tax you paid on that income and the software should reduce your US tax liability (or not). This is simply not possible to do with this software.
There is no link between US income and US taxes and Foreign Income and Foreign Taxes in this desktop version. There simply isn't. It either counts it twice or not at all.
