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Level 2

Can expat tax prepare and file with Turbo Tax?

I live full time in Europe.  I receive disability income from the country where I reside.  It's just like Social Security disability income.  For the last seven years, my taxes were being done by a commecial tax preparer.  I'm thinking of using Turbo Tax for the first time.  Among the forms that I will need to file, other than 1040, are Schedule 1 & 3 and Schedule B, and Form 1116 (2x).

 

Can I use Turbo Tax to prepare this return?  Can I use Turbo Tax to e-file this return?

1 Best answer

Accepted Solutions
Employee Tax Expert

Can expat tax prepare and file with Turbo Tax?

If you are looking to claim the income, it could go on sch 1, line.8. You are stating form 1116. credit for taxes paid. Here is a link to all treaties.

For the 1116:

1. Log into your return

2. select Pick Up Where I Left Off

3. In the top right corner, locate the Magnifying glass/search  

4. enter the exact words foreign tax paid

5. Enter

6. Select the first entry Jump to foreign tax paid

7. Tell us about your foreign taxes, select None of these apply

8. Foreign taxes, you may want to read the "category of foreign income" box, click CONTINUE.

9. Do you want deduction or credit? Let's pick TAKE A CREDIT, if you are itemizing, you may want to try it both ways.

10. Continue

11. No Other Income or Expenses, choose NO

12. Continue

13. Continue

14. Choose the income type, Income re-sourced by treaty

15. Country Summary, click on Add a Country 

16. Select the Country

17. Enter description and Amount for each, then Continue

18. Related Expenses, if applicable,  enter description, amount, country, and deduction type then Continue

19. Foreign Losses, enter loss as a positive amount, if any, then Continue

20. Foreign Taxes Paid- country, enter the taxes paid into the Foreign Taxes on Other Income box and the date paid box has a default for the last day of the year that you can change.

21. Alternative Minimum Tax - country, if you did not itemize, the program will answer for you. then Continue

Congratulations, you have finished.

 

Please be sure to preview your return and compare it your prior year return. See How do I preview my TurboTax Online return before filing?.

Although, you may prefer working in the desktop version as it has more forms and abilities than the online version. The desktop version must be paid for before using. You can try the online version first. If you like it - great.  You can switch to desktop and download all your information easily. The online is no charge until you file. You want to start there as you may decide the support you need is not available.

 

 

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View solution in original post

5 Replies
Employee Tax Expert

Can expat tax prepare and file with Turbo Tax?

TurboTax can prepare the forms you state,  however TurboTax does not include support for foreign sourced disability income. Disability income is not earned income therefore the foreign earned income module would not support foreign disability income. 

TurboTax would not be able to prepare and efile an accurate tax return for you.  

Level 2

Can expat tax prepare and file with Turbo Tax?

Doesn't Schedule 1, Line 8, "Other Income" work for this?

Employee Tax Expert

Can expat tax prepare and file with Turbo Tax?

If you are looking to claim the income, it could go on sch 1, line.8. You are stating form 1116. credit for taxes paid. Here is a link to all treaties.

For the 1116:

1. Log into your return

2. select Pick Up Where I Left Off

3. In the top right corner, locate the Magnifying glass/search  

4. enter the exact words foreign tax paid

5. Enter

6. Select the first entry Jump to foreign tax paid

7. Tell us about your foreign taxes, select None of these apply

8. Foreign taxes, you may want to read the "category of foreign income" box, click CONTINUE.

9. Do you want deduction or credit? Let's pick TAKE A CREDIT, if you are itemizing, you may want to try it both ways.

10. Continue

11. No Other Income or Expenses, choose NO

12. Continue

13. Continue

14. Choose the income type, Income re-sourced by treaty

15. Country Summary, click on Add a Country 

16. Select the Country

17. Enter description and Amount for each, then Continue

18. Related Expenses, if applicable,  enter description, amount, country, and deduction type then Continue

19. Foreign Losses, enter loss as a positive amount, if any, then Continue

20. Foreign Taxes Paid- country, enter the taxes paid into the Foreign Taxes on Other Income box and the date paid box has a default for the last day of the year that you can change.

21. Alternative Minimum Tax - country, if you did not itemize, the program will answer for you. then Continue

Congratulations, you have finished.

 

Please be sure to preview your return and compare it your prior year return. See How do I preview my TurboTax Online return before filing?.

Although, you may prefer working in the desktop version as it has more forms and abilities than the online version. The desktop version must be paid for before using. You can try the online version first. If you like it - great.  You can switch to desktop and download all your information easily. The online is no charge until you file. You want to start there as you may decide the support you need is not available.

 

 

**Say "Thanks" by clicking the thumb icon in a post
**Mark the post that answers your question by clicking on "Mark as Best Answer"

View solution in original post

Level 2

Can expat tax prepare and file with Turbo Tax?

Hi Amy, thanks for the answer.  I have not yet started the process of filing my return.  But I do have a question with Step 11.

 

I do have a small amount if interest income that will need to be declared.  This interest is from my European bank account.  So I assume that my answer in Step 11 would be yes, in order to be able to declare this income.

 

Or am I wrong?

 

Please let me know.

Employee Tax Expert

Can expat tax prepare and file with Turbo Tax?

Step 11 will be No because you are taking the foreign tax credit on foreign disability income. Saying No will begin preparation of the Form 1116.

 

If you have foreign disability income and foreign interest, you will fill out a separate Form 1116 for each category of income that is reported on the form. Interest income is Passive income.

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