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Returning Member
posted Jun 6, 2019 9:27:06 AM

I have a Foreign Tax Carry-over as calculated on last year's return. I did not earn foreign income in 2017. Can I apply the carry over if I had no income?

Since I have no foreign income on 2017, Turbotax shows the column 15 of form 1116 zero. Then line 30 is calculated zero. Therefore I can not utilize the foreign tax credit carryover from previous year. How can I use my carry over if I have no foreign income in the tax year?

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1 Best answer
Intuit Alumni
Jun 6, 2019 9:27:08 AM

If you can't claim a credit for the full amount of qualified foreign income taxes you paid or accrued in the year or you had no foreign income this year, you're allowed a carryback and/or carryover of the unused foreign income tax. You can carry back for one year and then carry forward for 10 years the unused foreign tax.

Please see Publication 514 regarding carryovers: https://www.irs.gov/pub/irs-pdf/p514.pdf

 

[Edit 03.18.20 | 1:47 pm]

6 Replies
Intuit Alumni
Jun 6, 2019 9:27:08 AM

If you can't claim a credit for the full amount of qualified foreign income taxes you paid or accrued in the year or you had no foreign income this year, you're allowed a carryback and/or carryover of the unused foreign income tax. You can carry back for one year and then carry forward for 10 years the unused foreign tax.

Please see Publication 514 regarding carryovers: https://www.irs.gov/pub/irs-pdf/p514.pdf

 

[Edit 03.18.20 | 1:47 pm]

Returning Member
Jun 6, 2019 9:27:10 AM

I do not think I can it carry back. Last year I used my foreign tax up to its limit. I do not foresee getting any foreign income in the future either. So it will be the same case each year. Therefore can I not use my foreign income tax at all?

Intuit Alumni
Jun 6, 2019 9:27:11 AM

If you do not foresee getting any foreign income going forward, then it will just carryforward each year until it expires.  Maybe you will go one a foreign business trip in the future.

Returning Member
Jul 5, 2019 9:09:09 AM

Did you get a solution for this situation ?

Level 1
Feb 22, 2020 12:10:46 AM

Any one has a good solution for this, I am in the same situation. Need help!

New Member
Apr 18, 2020 3:58:48 PM

KarenJ,  can you explain how a foreign business trip can release some of the foreign tax credit carryover when you do not have foreign income (US based and no more wages from abroad)?   I do take 1-2 week trips to abroad each year for business purposes.