How do I get software to allow input for Form 1116 for Foreign Tax Credit due to Foreign Income Taxes paid that are related to Passive Income (cap gains)?

[DaveF1006]

To clarify, what kind of passive income is this?

[jessica-kohr]

Hi Dave,

Capital gains from a stock sale. No issues inputting the income but not able to get the Foreign Tax Pd into Sch 1116.

[AmyC]

I assume you entered your income on the Form 1116 and are trying to get through the passive income section and get the tax entered. Let's continue through together.

1. You selected  passive income, continue
2. Select add a country - blue button
3. Select the country from the drop down
4. continue
5. enter description of income and amount not already reported on the forms listed, continue
6. explanation of expenses, continue
7. enter any losses
8. enter foreign tax paid
9. select No - foreign tax paid on other income
10. enter the taxes
11. continue
12. Enter any AMT amounts - AMT is on Form 6251
13. Continue
14. add any more countries or select done.

[jessica-kohr]

Hi Amy,

Thank you for your very detailed response.  I was not able to enter Foreign Income directly in the 1116, the only Foreign Income option I have when searching for Foreign Income in the Income section is Earned Income.  I finally placed my Cap Gains in the 1099-B section but was unable to get the software to accept a Foreign tax credit that didn't come from 1099-Div.  Your feedback was very detailed and I thank you but I wasn't able to even get to where your guidance begins and after fighting the Turbo Tax software for 7hours on this topic I'm giving up and will file using a different resource.

Appreciate your time to reply to my query.

Jessica

[JamesG1]

In TurboTax Premium Online, report capital gain transactions as foreign tax credit income by following these steps:

1. Down the left side of the screen, click Federal.
2. Down the left side of the screen, click Deductions & credits.
3. Click the down arrow to the right of Estimates and Other Taxes Paid.
4. Click to the right of Foreign Tax Credit.
5. Follow the screens to see whether you qualify for the credit or deduction.