If you file for a tax credit on Form 1116, do you receive a tax credit for 100% of the foreign taxes you have already paid on dividends?

[Lindaboo2]

If you file for a tax credit on Form 1116, do you receive a tax credit for 100% if the foreign taxes (approximately $2000) you have already paid on dividends?

[CherylW · Accepted solution]

It depends on your other income.

Your US tax liability is multiplied by a fraction of your total foreign income over your total income.

Depending on your situation, Turbo Tax will automatically do that for you.  Just put in your total foreign income tax paid on your dividends in, and we'll take care of the calculation, once all your tax info for the year has been entered.