How do I claim foreign tax paid on interest income in a foreign country? Created a 1099INT, but TT does not pick it up in the foreign tax credit section. Pls help, thanks

Level 15

Apr 8, 2025 2:34:49 PM

Are you talking about foreign taxes paid and reported on 1099-INT or is it where you earned interest on a bank savings account or FD /CD and now want to recognize the earned interest and Taxes held/deducted at source ( TDS ) ?

If the former then TurboTax would know about the FT but in the latter TT has no way of knowing.

In the latter case, you have to recognize the interest earned just as if you had received this from a domestic source ( just no 1099-INT and obviously no EIN. You then go to the "Deductions & Credit" section/ tab and from the list of deductions/credits choose "Foregin Tax Credit". Answer all the questions and TT will fill out the form 1116. Note that while US will recognize the total Foreign Tax paid, the allowable amount for the tax year is the lesser of actual paid amount and allocated US taxes on the same doubly taxed income ( US uses a ratiometric allocation based on Foreign source income to world income ).

Does this answer your query ?

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How do I claim foreign tax paid on interest income in a foreign country? Created a 1099INT, but TT does not pick it up in the foreign tax credit section. Pls help, thanks