Form 1116 Part I Line 3e Gross Income From All Sources TT Calculation Error?

[TommyT208]

Used my TurboTax Premier Desktop version to complete and file my 1040 Return. As I am now reviewing my Form 1116 Foreign Tax Credit included within completed and submitted files, I find that the amount inserted by the TurboTax software in Form 1116, Part I, Line 3e "Gross Income From All Sources" is reflecting a $ number $57,304 greater than my Total Income & Adjusted Gross Income numbers listed on Page 2 of my Form 1040. No idea where this higher number is coming from, and can only suspect an error in the TT software. Can anyone help me on this, or direct me to appropriate contact within TurboTax?  

[Mike9241]

did you read the 1116 instructions for how that line is computed? it's always good to know things. see page 18

https://www.irs.gov/pub/irs-pdf/i1116.pdf 

I checked on my return and the number is correctly computed you just have to understand the crazy tax laws.

[AmeliesUncle]

On the 1116, Gross Income includes business and rental income BEFORE the business or rental deductions (the deductions are handled separately on the 1116).

Does that seem to apply to your situation?

[TommyT208]

Thanks for the quick response. Actually, yes sir, I did read the referred page 18 in instructions, and nothing there related to my circumstances. I simply cannot find any relationship to where the software would be pulling this exaggerated number from. I'll keep researching.

[TommyT208]

Thanks for the response. In my particular situation I only have passive category income, and exclusively all from Qualified Dividends only, nothing else, thus what you're mentioning would not apply in my case.

[TommyT208]

In follow-up, are you really telling me that the "Gross Income From All Sources" number listed by TT on Line 3e of Form 1116 can in fact be an amount Greater than my "Total Income" number calculated by TT? I can't see how that can ever be possible. I'm curious, since you refer to your own circumstance for this Line 3e data being correct, is this number also Greater than your Total Income number? I'm of the understanding that my Total Income number is already inclusive of ALL Income, from ALL sources, and before any credits and/or deductions, so belief that the Line 3e number should thus be equal to, but not greater than my Total Income number. What am I missing?

[AmeliesUncle]

Look at lines 1-7 on your Form 1040, and lines 1-8 on Schedule 1.  Which lines have income on them?

[TommyT208]

Thanks for the follow-up.

Form 1040, Lines 1 thru 7 with data in them:

2a, 2b, 3a, 3b, 4b, 5b, 6a, 6b, and 7

Schedule 1, Lines 1 thru 8 with data in them:

None - Schedule 1 not included in filing, not applicable

[AmeliesUncle · Accepted solution]

Tax Exempt interest (line 2a).  The US return does not add that in, but Form 1116 does.

Social Security (lines 6a and 6b) - The US return only uses the taxable amount (line 6b), but Form 1116 uses the full amount (line 6a).

Capital gains (line 7).  Did you sell multiple items, and any at a loss?  Line 7 of the US return adds up the ones with gain, and subtracts the ones with losses.  Form 1116 only adds up the ones with the gains.

[rogge1722]

In Forms mode, bring up f1116. Scroll down to the Gross Income from all sources worksheet. Put the pointer over the amount in cell A and right click.  On the box that appears, click on Data Source.  Another box will appear how TT obtains that amount.

[TommyT208]

Ah Ha, this explains it all, and thank you for this clarifications. Capital Gains, when not counting the losses is the one big difference in Form 1116 that had me scratching my head. I get it now, and thanks again so much.

[TommyT208]

Thanks for this insight, as I was unaware of that info availability. Will remember in the future though.