How to report foreign income and dividends

[jeanandmichael]

where on turbo tax do I report foreign interest and dividends?

[KarenJ · Accepted solution]

You will report foreign interest and dividends as if you received a 1099INT or a 1099DIV.

Enter 1099int in the search box at the top of the screen. Click Jump to and it will take you to the interest section.

Enter 1099div in the search box at the top of the screen.  Click on Jump to and it will take your to the dividend section.

• IF you have foreign tax paid on foreign interest and dividends and no forms, please enter the interest/foreign tax AS IF you have form 1099-INT (put foreign interest in box 1 and foreign tax in box 6) or form 1099-DIV respectively. 

[KimT-IL]

So then do I just deduct those amounts from the total on the 1099-DIV on which they were reported as a lump sum?

[ReneeM7122]

Yes,  you are correct.  You can deduct those amounts from the total on the 1099-DIV on which they were reported as a lump sum.

@KimT-IL

[TreeCutter]

This answers provided so far are not helpful, or perhaps leave too much unsaid. 

This is a foreign dividends question.   

I have a 1099 from a Brokerage Firm.  Part of my dividends are from foreign stocks, both registered in the UK.  The UK does not withhold taxes on the dividends, due (I believe) to a treaty with the US.   On my 1099, the foreign dividends are mixed with dividends from US (domestic) stocks, so I get only one number.  Yet, I suspect I am supposed to report to the IRS the portion of these 1099 dividends that come from foreign sources.   

So question 1: Do I need to tell the US govt how much of the dividends are from foreign sources?

Question 2:  If 1 is Yes, then how/where do I do this.  

Question 3:  If 1 is Yes, where - on which form - do I tell the IRS which country the dividends came from? 

Since the UK did not withhold any taxes on the dividends, there were no foreign taxes paid, and therefore it appears to me that a Form 1116 is not necessary and is not appropriate.

Question 4: Can someone confirm whether this is correct. 

[DaveF1006]

You will report foreign dividends as if you received a 1099INT or a 1099DIV.

1. Enter the information on the 1099DIV form.  Check  the the box where it says My form has info in other boxes (this is uncommon). Enter $1 of foreign tax paid in Box 7.
2. As you move through the screens, you will reach a screen where the program will ask you to report your foreign dividends earned. here you will enter the amount of foreign dividend income.
3. Since there were no foreign taxes paid, you do not need to file a Form 1116.
4. it is not necessary to report the country where your dividends were earned from. 

[TreeCutter]

OK, I will try that. 

TurboTax perhaps should change their software. By putting in the $1, as you suggest, I am putting in false data so I can make the software bring (fool the software into bringing) up the screen I need.  IMO, there should instead be a way to do this without having to 'fool' the system.  

I will try it, see what happens. 

[DaveF1006]

No software product is full proofed and sometimes it is necessary to fool the system. This is not going to impact your tax return in a negative manner..

[TreeCutter]

This solution does not work.  

I specified "My form has more info ... "

I put in the $1 in Box 7 (Foreign Taxes Paid)

I went through the two screens after that - FEIN and Uncommon Situations (I put in None since none of them applied) ... no screen came up that asked me about Foreign Dividends.   When I hit Continue, it goes back to the Dividend Entry screen.  

[Anonymous]

I have the same question now. I'm stuck at a screen where an amount of $0.18 was paid as dividend on 1099-DIV form and now TT smart check is alerting me to include "Foreign Source Amount" in Box 7 d. What should I be putting there as TT is not allowing me to proceed further?

Appreciate any help here.

[DaveF1006]

Put in $1 to see if that will clear up the discrepancy.

[Jerry 1]

my 1099div is in pounds UK. Will turbo tax convert it to dollars

[DoninGA]

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@Jerry 1 wrote:

my 1099div is in pounds UK. Will turbo tax convert it to dollars

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No, TurboTax does not do currency conversion.

Go to this IRS website for currency conversion based on yearly averages - https://www.irs.gov/individuals/international-taxpayers/yearly-average-currency-exchange-rates

[lubomm]

That sounds reasonable and would be my guess. But there is also an item in Turbotax called foreign tax credit, form 1116. That form contains foreign taxes paid abroad to get credit for. Which approach would be more appropriate? 

[AmyC]

Dividends are entered as dividends in U.S. dollars. Any foreign tax paid on those dividends is entered under foreign tax paid.

Since the directions for entering dividends is earlier in this thread, I will post the tax paid portion.

All foreign tax paid is entered in the same spot. To report the foreign tax paid on your dividends for foreign tax credit:

1. Enter foreign tax credit in the search box at the top of the page and click the Jump to link
2. Select Yes you paid foreign taxes
3. Continue through the screens regarding foreign interest and dividends
4. Select yes that you have reported all your foreign income already in TurboTax
5. Deduction or Credit? Most people choose the credit since so few itemize deductions. You can try it both ways and determine what is best for you. Select an option.
6. Answer question about the Simplified Limitation Election
7. Choose income type 
8. Add the name of  your country
9. Enter description -
10. Enter Income amount that you previously reported in another section of TurboTax 
11. Enter your taxes you paid on your foreign dividends in the box "Other income"
12. Continue through the foreign tax credit screens until done.

@lubomm