Form 1116 Carry Over Question

[MatthewR87]

For the past several years I've filed Form 1116 for the general income category and have some foreign tax credits that I've been carrying over. 

This year, I do not have general income, but I do have passive income from bank interest. I paid $288 in foreign taxes on this interest. This should be Form 1116 exempt correct? But TurboTax fills it out anyway and it calculates my foreign tax credit to be $218 instead of $288.

At the same time I have noticed that Turbotax automatically includes Form 1116 for general income even though I do not have general income this time around. I assume this happens to facilitate carryover of the tax credit.

When I delete the general income form 1116, the passive income form 1116 is also removed from my tax return (because the amount I am claiming is exempt) and then my tax credit becomes the full $288. 

How should I proceed? Thanks!

[MatthewR87]

This year, I do not have general income, but I do have passive income from bank interest. I paid $288 in foreign taxes on this interest. This should be Form 1116 exempt correct? But TurboTax fills it out anyway and it calculates my foreign tax credit to be $218 instead of $288.

At the same time I have noticed that Turbotax automatically includes Form 1116 for general income even though I do not have general income this time around. I assume this happens to facilitate carryover of the tax credit.

When I delete the general income form 1116, the passive income form 1116 is also removed from my tax return (because the amount I am claiming is exempt) and then my tax credit becomes the full $288. 

How should I proceed? Thanks!

[rogge1722]

That is OK.  You are utilizing the exemption for passive category income and no f1116 of any category is needed.  You are done with foreign transactions.