Form 1116

[pmennnen]

Working on my taxes online in TurboTax Deluxe I run into the screen "Tell us about your foreign dividends".

You have entered $309 of foreign taxes paid. Now enter the portion of the xxxxx dividends and distributions that was from a foreign country. Then I enter the correct amount in the box below. Then I selected the radio button that says "Mutual Fund/Regulated Investment Company (RIC). All should be well according to the instructions I read, however then when I check my return it always warns me ...

"Check this Entry" Schedule B form 1099-DIV: Form 1116 copy should be entered. Return to the place where this was entered to correct the entry. A grey shaded box appears (Form 1099-DIV worksheet 2023). Scrolling down to box 7 it shows the correct amount for Foreign tax paid and also the correct amount for (d) Total foreign source income. On line "b" it says "DoubleClick to link to a copy of Form 1116, but double clicking on that or the empty box to the right does absolutely NOTHING. Under line c it says "select which column A, B or C". A is selected automatically but it is grayed out, so I couldn't change that even if I wanted to. This seems to be the only place I have found to enter a Form 1116 but it simply does not work. Why do they make it hard to declare such a simple credit. I try to call turbo tax for support but it wants me to pay another $79 to upgrade turbotax for the live assistance. Do I really need to pay for live assistance when turbotax is simply broken. It would be cheaper just to ignore the fact that I deserve this credit, but it doesn't feel right to have to do that. Any suggestions?

[DaveF1006]

To look at this in detail, we would like to see a diagnostic copy of your return. The information in this file is a sanitized copy meaning there is no personal information, only numbers so that we can troubleshoot in depth, check for calculation issues, and to see how certain items are applied. Here is how to order. 

For Turbo Tax online, go to tax tools>tools>share my file with agent.  When this is selected, you will receive a token number.  Respond back in this thread and tell us what that token number is. 

If you use the desktop version, go to the black stripe at the top of the program>online>send tax file to agent. Once you receive the token number, reply back in this thread and let us know what that token number is.

[pmennnen]

Thanks a lot for your reply. I did as you suggested ("Share my file with Agent").

My token number is 1199757.

~Paul

[DaveF1006]

It depends. I am looking at your return and I see no issues other than you did not receive a foreign tax credit. Here are a couple of things I can suggest.

1. In the Dividend worksheet, when it says click on the Box, there will be an arrow that point upward and to the right.  It is in the left side of the box. Select that and then select link.  That should link Copy 1.
2. Now go to Federal>deductions and credits>deductions and credits>estimate and other taxes paid>Foreign Tax Credit>start or revisit
3. As you navigate through the screens and reported RIC is the country you are reporting, then select report income. Be sure to indicate that you wish to take the credit rather than the deduction when it asks for this.
4. Next screen will say report income to RIC.  Select Charles Schwab with a checkmark.
5. Next screen should populate with the foreign income that was already reported.
6. Say no when it asks if you wish to review your entries.
7. As you finish out the section, you should receive a foreign tax credit of $XXX. The remainder will be carried over for the next ten years.
8. After this section is finished, the only error message you should receive is that it asks you for the country in California where you reside.

If this doesn't work in your return. You might try deleting Forms 1116 and then go through the steps again to claim the Foreign. To delete in TTO.

1. Go to tax tools
2. Tools
3. Delete a form
4. Delete form 1116

If in the desktop version, open your return.  Go to the Forms mode and select form 1116. Delete it and then repeat the steps above and let's cross our fingers that this will clear all the error messages.

[pmennnen]

The box you mention in the dividend worksheet is completely blank. No arrow pointing upwards and to the right as you suggest. I thought it might be a problem with the chrome browser, so I tried it using the edge browser. Nope ... same thing. Simply no arrow and nothing available to click!

I tried deleting the 1116 form from the tools menu as you suggested. After clicking "Delete" I look at the forms list and it still  includes the 1116 form (copy 1). Even if I sign out and sign back in the form is still there and there  still is no arrows inside the box that it always brings me back to in the review.

Turbotax is clearly broken. Do you think I should just clear the form and start my taxes all over again from the beginning? Of course, it may do the same thing again. Maybe I should just try a different tax preparation package? Do you have one to suggest?  ~Paul

[DaveF1006]

Yes. Let's start over and see if we can resolve this issue so that you won't receive this dreaded error message.

1. Go to your 1099 DIV entry and remove the foreign tax amount in Box 7,
2. Delete Form 1116 from the tools menu
3. Now log out and back again. Form 1116 should be gone along with Schedule B Form 1116.
4. Now go to 1099 DIV and reinsert the Foreign Tax Paid in Box 7.
5. Now go to deductions and credits>estimate and other taxes paid>foreign taxes
6. In the Screen, where it asks where the Dividend income came from, enter RIC.
7. Click on RIC in the next screen and select report income.
8. Now place a check mark where it says Charles Schwab
9. Now there should be an amount listed in the next screen in Foreign Sourced Income
10. Next screen asks if you wish to review your entries.  Say no.
11. There should be a check mark already populated in the next screen.
12. Now select simplified method
13. No other income or expenses, say yes.
14. Continue through the next screen where it mentions foreign taxes paid and say no in the carryover screen.
15. the very next screen should say that you have a foreign tax credit of $137.
16. Continue until you are done.

Let us know if this works.

@pmennnen 

[pmennnen]

Remarkably your suggestion worked perfectly. Thanks for working on this. Otherwise I probably would have given up on TurboTax and tried a different online tax software solution.

~Paul