Foreign Tax Credit on Dividends

[homegecks]

I paid $630 in foreign taxes related to dividends and file a joint return.  Am I required to use form 1116 to calculate the tax credit or can I take the maximum credit amount of $600 on schedule 3 and not file the 1116 form (much less of a credit)?  It does not appear as though turbo tax allows this override.

[pk]

@homegecks , imho, if you want the most amount of foreign tax credit ( i.e. not limited by a ratio of foreign income  to world income) , you are better off  entering the  safe harbor amount when you enter the 1099-DIV -- this way you will get all the $600 deduction to your tax liability  -- obviously  you will get no credit for $30  abut if you use the form 1116 ( required  if you  recognize above the safe harbor amount of  $600 ), you will get a a fraction of the total for the year -- you get to carry back or forward till extinguished ( ?? ) but you need to have foreign income each year to claim any benefit.

This is my personal view to get the most  benefit

Is there more I can do for you ?

[homegecks]

I appreciate your reply.  Are you saying enter the $600 as tax paid for my 1099-Div as opposed to the actual $630.  That would certainly resolve my dilemma but wasn't sure if that was allowed since it would be a different amount of the 1099-Div?

[Mike9241]

yes forgo the 1116 and take the $600.  in all the years I prepared tax returns there were numerous returns with the FTC.  the 1116 was prepared when the allowed FTC exceeded the max. however, in only rare circumstances did any part of the FTC carryforward ever get used because the US tax brackets the taxpayers were in were lower than the foreign tax rate