Bug in Turbo Tax?? Form 1116 Asking for an Explanation of Domestic U.S. Contribution to IRA?

[rjbur007]

I have gotten to: "Check This Entry: Form 1116 (COPY 1) Explanation Stm: Detailed explanation must be completed.  Enter your explanation here to complete the required statement.  It must show the other deduction items for line 3B column a."

YES this is the same as others, but when I work my way to the form it shows $2,000.   I Right-Click on the amount and choose [Data Source] and it pops up a window that says "1040/1040SR Wks Adjustment Income      2,000".

I  click on the 2,000 number and the open form changes to the 1040/1040SR wks form and is on Line-22 and shows the $2,000.  So I Right-Click again and it says, "The sum of lines 23 through 31a and 32 through 35 plus Amounts reported in the Other Adjustments to Income Smart Worksheet".

The actual Line-22 says, "Add lines 10 through 21........".  Well the ONLY number in between lines 10 through 21 is in Line-19 that says "IRA deduction" and the amount is $2,000.

So how does a domestics / United States contribution into a US IRA end up on Form 1116 through this chain??

What do I enter for the Detailed Explanation?  

[Mike9241]

from 1116 instructions:

Line 3b. Enter on line 3b any other
deductions that don't definitely relate to
any specific type of income (for
example, the deduction for alimony paid
from Schedule 1 (Form 1040), line 18a).

an IRA would fit this category but it's only supposed to be a pro-rata portion of your IRA 

(gross foreign income to gross income from all sources - i would use 3d divided by 3e times your IRA deduction)

for an explanation  enter IRA

did you know that if your FTC is less than $300  for single filers $600 for joint filers, the 1116 is not required unless

1) the FTC is from a category other than passive income (for this purpose passive really means portfolio income like dividends and interest) and

2) you have no FTC carryover from prior years

[rjbur007]

The $2,000 was an IRA Contribution, not a withdraw. 

As stated on the IRS site About Form 1116:

"File Form 1116 to claim the foreign tax credit if you are an individual, estate, or trust, and you paid or accrued certain foreign taxes to a foreign country or U.S. possession."

I'm a U.S. citizen living in the U.S. using my U.S. accounts so why would my $2000 U.S. dollar transfer into my existing U.S. IRA end up on Form 1116?

[rjbur007]

PING.....

Anyone have any idea why and what to do?

[rjbur007]

Is there an expert out there that can tell me if this is a BUG in Turbo Tax??

I am about to just override the form as it does not make sense to me that a form that deals Foreign matters is asking about my U.S. IRA Contribution?

I'd like to finish my taxes and this is the ONLY thing holding me up.

Thanks,

[rjbur007 · Accepted solution]

Gave up and Contacted customer support...

Was connected with a Tax Expert that actually explained why this for cares about non-foreign entries.

Basically the 1116 form needs to use these other non-foreign deductions as it affects the calculated final applicable portion of the foreign amount / deduction....

Something along these lines.

So my description was "Traditional IRA Contribution of $2000 for 2020". 

[shaynap84]

how were you able to identify even what was in 3B within the 1116?  I cant find it.