You are referring to the form 4952 and form 1116 strategy whereby qualified dividends can be characterized as ordinary dividends which will increase your tax liability but in return foreign qualified dividends are treated as ordinary dividends and not subject to adjustment. The increase in foreign tax credit will have an overall reduction in the tax liability.
This requires form 4952 and the schedule D tax worksheet in lieu of the default qualified dividends and capital gain worksheet. The IRS is aware of this strategy and mentions it in the form 4952 instructions.
