While the income is blocked you must file an information return with your tax returns using another Form 1040 labeled “Report of Deferrable Foreign Income, pursuant to Rev. Rul 74-351.” You must declare on the information return that you will include the deferrable income in your taxable income in the year it becomes unblocked and finally that you must also state that you waive any right to claim that the deferrable income was includible in your income for any earlier year.
Please read the following Link provided below and read the sections labeled Blocked income. As an FYI, make a copy of your 1040 generated in your return and then written on a separate statement is where you would report the information required. Be sure you write on top of the 1040 "Report of Deferrable Foreign Income, pursuant to Rev. Rul 74-351".
You will need to print and mail your return, including the second 1040 as well as the written statement.
Publication 54
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