Form 1116 & Gross Income All Sources Questions

[drennman]

Form 1116 has now been updated by TT.  It now  produces the same FTCredit as before and no longer says "Do Not File."

However it seems like there is some kind of worksheet that is used for the Foreign Tax Carry Forward that is not yet available.  It's just pretty simple math.  On my Foreign Tax Credit Computational Worksheet the Carry Forward totals are "marked as error"  (yellow box/red type face).  Anyone know why?  Or do I really need to wait until 3/31/22 for some new schedule?

Also, I find a mystery in the TT value for "Total Income all Sources" in 1116 line 3f.  It looks like there is some sort of Gross Income from All Sources Smart Worksheet that I can't click-on/find-on-forms.  Is there a way to see that "Smart Worksheet"?  

I can't seem to find any math combinations that arrives at the TT number.    How is it calculated?  I have a pretty simple return and no losses from stock sales etc.

Thanks in advance for help! 

[MarilynG1]

What type of Foreign Income are you reporting?  There are seven categories.  There's a separate Form 1116 for each category.  If it is only 'passive income' from 1099-Div or 1099-Int, the Foreign tax you entered for these is transferred automatically to the Foreign Tax Credit Section.

All you need to do is enter the amount of passive income associated with these taxes in this section. 

However, you are correct that if you had Foreign Tax Credit carryovers from 2020, you need another worksheet that details the type of foreign income that the carryover is for. 

"Any carryover or carryback amount requires attachment of a detailed computation for the amount claimed. If carryovers are entered in this worksheet, the program will automatically print a Form 1116 Carryover Statement containing the information in the "Carryovers from 2020" section. Alternatively, the carryover worksheet may be attached as a statement."

The Form 1116 Carryover Statement is scheduled to be available 03/31/2022. If you elect not to claim your carryover, you could probably Efile now. 

I don't see "Total Income all Sources in 1116 line 3f" in my Form 1116 for either General Category Income or Passive Income.

Here's more info on Claiming the Foreign Tax Credit.

[drennman]

Thank you MarilynG1 for your help!

Sorry I wasn't clear about the sources of foreign income.  Yes, you are correct to note there are a number of possibilities.  

In my case it's only dividend income from funds like "Developed Markets - ex US".  So this income comes directly from the 1099-B's.  

I also see that I made a typo.  My apologies.

"Total Income all Sources" is in Form 1116 Part I line 3e (not 3f).  

This amount appears to come from a "Gross Income from All Sources Smart Worksheet" that I can't click-on/find-on-forms.  Is there a way to see that "Smart Worksheet"?  

I'd take Gross Income from all Sources to mean earned income, interest, capital gains, dividends etc so the Total Gross Income from All Sources should be a straightforward addition/subtraction.  It's not limited to foreign income.

I can't seem to find any math combinations that arrives at the TT number for Gross Income (1116 Part I line 3e).    How is it calculated?  I have a pretty simple return and no losses from stock sales etc.  

Thanks Again!

[drennman]

It sounds like the new Foreign Tax Carry Forward Schedule B  (available March 31) is going to sort out the various categories of foreign income to potentially adjust the carry-forward amounts.  

It also seem that if all the carry-forward is due to exactly the same situation (e.g. foreign tax held at source for foreign dividend incomes from a fund say offered by Vanguard) the results will be the same.

But I can guess that if, say, you had both foreign eared income and foreign dividend income the carry-forward might change.  

[CarissaM]

By popular demand we have worked on this form, and it will be available and to e-file sooner. It will be available on March 11, 2022. @drennman