As a general rule, you
must choose to
take
either a
credit
or a
deduction
for all qualified
foreign taxes
. Between the twos, the credit is more beneficial to you. It is a dollar by dollar reduction of your tax due. For example, if your tax due is $400, the program would subtract your credit directly from your tax due. ($400-$42=final tax due )With deductions, you can benefit it only if you itemize and it reduces your taxes based on your tax bracket.
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