The Miscellaneous Section will work to report the income. I have no opinion on the tax treaty. Here is the procedure to to input the data. Copy 1 is used for the pension. Copy 2 is used for the dividends.
By default, TT will want to process the dividends first, so we go thru the initial screens with minimal entries to get to the back section to process the pension income first. To ensure a clean start, delete form 1116.
- Foreign Tax Credit.
Continue
2. Tell us about your foreign taxes.
This screen may or may not appear for various reasons.
If displayed, click on Continue.
3. Foreign Taxes
Continue
4. Do you want deduction or credit?
Credit
5. Reporting foreign taxes paid
Continue.
6. Where did you receive dividend income?
Not used at this time, so just select the first one then Continue
7. Income from foreign countries
Done
8. Need to report income
No
9. Simplified limitation election for AMT
This screen may or may not appear for various reasons.
If displayed, will assume YES is selected
10. No other income or expenses
No
11. Completing forms 1116
Continue
12. Foreign tax credit worksheet
Continue
13. Choose the income type
This starts the back section for pension income. Choose General category then Continue
14. Country Summary
Click on Add a Country.
15. Select Country from the list.
16. Other Gross Income-Country
Enter the description and the amount even though entered elsewhere.
17. Definitely related expenses
Enter any applicable amount.
18. Foreign Losses.
Enter any applicable amount.
19 Foreign taxes paid.
Enter the amount in box for other income.
20. Country Summary
Done
21. Continue thru the next several screens until you reach:
22. Foreign Tax Credit Summary.
You should see displayed Copy 1 General Category Income.
Click Done.
23. Go thru a few more screens and exit the interview.
Now re-enter the interview. Enter the data for the dividends and TT will generate Copy 2, passive category , F1116. TT may ask for paid or accrued and the date paid. The default is “Paid” and the date 12/31/2024.
Lastly, verify that Copy 1 displays the greater amount of credit.
