You are not interpreting this correctly:
- You are correctly being taxed on 100% for U.S. income tax purposes. U.S. taxes your worldwide income.
- Then you are taxed on 50% in Sweden.
- Then you get a foreign tax credit on your U.S. income tax return for the 50% tax that you paid to Sweden.
- While credits don't always offset $ for $, this is what it is.
- So essentially the foreign tax credit is meant to alleviate the Swedish tax paid.
- So no double tax
*A reminder that posts in a forum such as this do not constitute tax advice.
Also keep in mind the date of replies, as tax law changes.
