How do I file an amended prior year return to reflect a carryback foreign tax credit (both standard and AMT)?

[edammer]

TubroTax Online 2025 version as of February 14 2026 is saying I have to amend my prior year return to reflect my new AMT election for simplified calculation of foreign tax credit, which I have maxed out for tax year 2025. I do not understand why the 2024 return must be amended and the credit cannot carry forward to 2026 (though I will be paying more foreign tax probably over the limit in the coming year).

[AmyC]

The IRS tax code says you must amend the prior year before you can carry forward with this election. Choosing the new simplified election locks you in to that method. You must continue to use that method for all future years unless you get IRS consent to change it.

Follow these steps:

1. Complete 2025 and locate excess foreign credit
2. To amend prior year, select amend
3. Update Form 1116 with the carryback from 2025
   • You could see a refund on your 2024 return if the carryback is used.
   • If it is not used, you have fulfilled your obligation in filing an amended return to claim the carryback and your forms show it.
4. Be sure to check the AMT adjustment for simplified election.

[edammer]

I filed my 2025 return for federal and state already. Going through the online TurboTax web interface, amending my 2024 return opens up the list of deductions and credits in 2024, and foreign tax credit is already there. Clicking through the guided prompt does not provide an opportunity to add carryback item(s) to the form 1116. Any additional UI tweak to get into and edit the form 1116 for 2024 would be great. I am assuming a refiling fee will be charged for amendment--is that right?

[DaveF1006]

Yes, here is how to get to the carryover screen in 2024.

1. Navigate to Foreign Taxes: Go to Federal > Deductions & Credits > Estimates and Other Taxes Paid > Foreign Taxes.
2.  Continue through the prompts. When asked if you want to take a credit or deduction, select Take a Credit.
3. If you don't have new 2024 foreign income, you must still add a "country" to trigger the form. Enter RIC if it is there.
4. Leave the income and current tax fields blank (or $0) and continue until you reach the "Foreign Tax Credit Summary" or "Carryovers" screen.
5. On the screen asking for carryovers, enter your excess credit amount from 2025. TurboTax will then populate the necessary line on Form 1116 for your 2024 amendment

[edammer]

Thank you for the guidance! I had to make a nominal change (and later change back) my 1099-DIV entry for foreign tax paid under the income section during the amendment to trigger the availability of prompts in the online 2024 amendment of foreign tax credit.  After that,  prompts which did not appear before in the existing foreign tax credit section appeared.

I then do get to the question "Do you have a carryback from 2025?"  The amount on my 2025 return, form 1116 schedule B line 7 "Actual or estimated amount of line 6 to be carried back to prior tax year (enter as a negative number)" is indeed negative. Question 1:  It is unclear if the carryback amount should be entered as negative in response to the question in the 2024 amendment prompt asking for the carryback amount.  It seems like entering one way will trigger another carryback and require amendment of the 2023 return I also filed with TurboTax, where at least I did not have foreign tax paid that year or any year prior. Entering the number as either negative or positive leaves me with a new tax liability for the 2024 amended return. So my second question is does carryback mean carryback of credit, or of liability--or have I done something wrong?

A final question is how to determine if the carryback is standard or alternative minimum tax (AMT) type. When completing my 2025 return, the prompts in this credit section led me to choose the option which said something like "this is my first year claiming the simplified calculation for AMT", but I never saw any indication that a tax filing for AMT was completed. My 2025 return is a form 1040 as filed. I chose the same option in the amendment of 2024, for consistency, and 2024 would truly be my first year of claiming a foreign tax credit (unless this amendment triggers an amendment for 2023).

[DaveF1006]

Enter it as a positive number. If the result is a higher tax bill, double-check that you have actually entered your Foreign Source Income for 2024. You cannot use a carryback in a year where you have $0 foreign source income.

“Carryback” always applies to the Credit, not the liability. If you paid too much tax in 2025, you can carry that credit back to 2024 to lower your 2024 U.S. tax. The rule is “back one year, then forward ten years.” If you have extra credits in 2025, you start by applying them to 2024. If there’s still some left after that, the rest moves forward to 2026. You can’t carry credits back to 2023—the carryback only covers one year.

As far as making a Simplified Limitation Election" for AMT, simplified is recommended, especially if your foreign taxes are one category of income, such as the passive category. It tells the IRS: "Use my regular tax foreign income numbers to calculate my AMT foreign credit." You will make this election in your 2024 amended return, even if you didn't pay AMT in 2024. The election stays on your "permanent record" with the IRS for future years.

[edammer]

After editing my 1099-DIV with foreign income and taxes paid declared by $1 (less), I fill out the carryback input (either AMT carryback from 2025, or regular), but the tax credit is not applied -- I see amount due of $1 for the amended 2024 federal return when carryback is from AMT, and an amount due of >$180 if the carryback from 2025 is not AMT (less than the expected credit).  I was able to switch the 2024 return to use the simplified AMT election for foreign tax credit. Is that the reason?

I asked the AI helper on the right sidebar of turbotax online, and got this answer:

"TurboTax Online primarily supports amendments with visible direct changes. For complex carryback entries that do not alter prior year amounts, specialized entries or forms might require manual review or using TurboTax Desktop for more detailed control.

This means you potentially could encounter limits in TurboTax Online for this specific carryback treatment without modifying the 2024 foreign tax figures."

Will try phone support today, but I have been trying adamantly for a week, and I may have to use H&R or another service, it is starting to look like.