Form 1116 (error?) - "Foreign Tax Credit Comps Wks: Paid/Accrued Boxes must be entered

[joezed75]

Hi,

I am filling out Turbo Tax exactly as a did last year. This year, I am getting an error in Smart Check that I have no idea how to fix, and thus I cannot file:

The error takes me to the1116 worksheet but I don't know how to fill it out and it was never a problem before.

My wife and I have over 10K in a foreign bank account. It earns no interest. That's it. We fill out an FBAR every year. I have checked off the boxes that say we have a foreign bank account and foreign assets.

Help!

[LinaJ2020]

 The issue has been submitted and is currently under investigation.  If you would like to receive an update for the progress, click on the following link to get notified:

Form 1116 reject error

If you have paid taxes to both foreign and the US tax authorities, the IRS allows you to claim a foreign tax credit on Form 1116 along with your US tax return.  The amount will show on Schedule 3 line 1 and line 20 on Form 1040.  

[jayhawkgirl107]

I have not entered any foreign taxes paid but TT is thinking I did.  Now what.

[LinaJ2020]

If the foreign tax does not apply to you, you can simply remove a Form 1116 from the program.  Here are the steps:

In TurboTax online, 

• Sign into your account, select Pick up where you left off
• From the left menu, select Tax Tools, click on the drop down arrow
• Select Tools
• Under Other helpful links, choose Delete a form
• Select Delete next to Form 1116 and Continue with My Return

If you have paid taxes to both foreign and the US tax authorities, the IRS allows you to claim a foreign tax credit on Form 1116 along with your US tax return. If this does not apply to you, you do not need to file this form.

@jayhawkgirl107

[joezed75]

Hi,

I am using the software version (not the online). Any suggestions?

[d__wood]

Getting exact same issue/error msg here on the desktop version.

No problem with past years submissions and did not pay any foreign tax in 2020.

[LinaJ2020]

If the foreign tax does not apply to you, you can simply remove a Form 1116 from the program.  Here are the steps:

In TurboTax online, 

• Sign into your account, select Pick up where you left off
• From the left menu, select Tax Tools, click on the drop down arrow
• Select Tools
• Under Other helpful links, choose Delete a form
• Select Delete next to Form 1116 and Continue with My Return

If you have paid taxes to both foreign and the US tax authorities, the IRS allows you to claim a foreign tax credit on Form 1116 along with your US tax return. If this does not apply to you, you do not need to file this form.

@d__wood

To remove the form from your desktop program, follow here:

• Open up your tax return if you have not already done so.
• At the right upper corner, select Forms 
• To your left, you would see a list of all the tax forms and worksheets, scroll down and select Form 1116
• While Form 1116 appears to your right, at the bottom of the screen, select Delete Form

@joezed75

[d__wood]

Thanks. While I did not pay foreign tax in 2020 I did have foreign income from an overseas rental property.

Should I still delete the form? There are multiple entries on other lines throughout the form including carryover values from 2019.

[LinaJ2020]

Yes, you should. If you did not pay any foreign taxes on your foreign income, you do not qualify for the foreign tax credit.  Form 1116 does not apply to you. 

You would enter your foreign rental income under the "Rental" section.  Here are the steps:

In TurboTax online,

• After sign into your account, select Pick up where you left off 
• At the right upper corner, in the search box, type in schedule e and Enter 
• Select the 1st choice on the search results - Jump to schedule e
• Follow prompts

@d__wood

[dmgmd]

I am also getting this error.  I paid foreign taxes through my mutual funds that are reported on my 1099-DIV but nothing else.  How do I get through this error to be able to submit my taxes?

[LASOS]

Same wondering what to do here....

[anshu2000]

Also Form 1116 is not listed in the Tools>Delete a Form section - what to do? I am using online version

[T0m]

I'm seeing the same bug in the Mac desktop Premier version.  Foreign tax doesn't apply to me and when looking at the forms list, Form 1116 doesn't appear.  Any ideas?

[AmyC]

The 1116 requires the source of the income as no credit is allowed with some foreign countries. Along with the source, the amount of income earned in that country is needed before credit can be given for the tax. Mutual funds use the option of RIC for regulated investment company.

To claim the credit, see Claiming the Foreign Tax Credit with Form 1116 - TurboTax

See About Form 1116, Foreign Tax Credit 

@dmgmd

@LASOS