@richard's_tax , I am not sure I understand what "US$20,000 threshold" you are referring to. Generally, once you are above the $400 foreign tax credit range, you have to file a form 1116 for the recognition of the credit. In such a case, the foreign taxes paid is recognized essentially dollar for dollar. However, the allowed credit for the year is based on a ratio of foreign income to world income -- thus higher the foreign income, more of the recognized foreign tax credit is allowed for the year. The residual amount of foreign tax credit can be carried back or forward -- but cam only be used when there is a foreign income . Please can you elucidate a little bit more on your situation ?
