Connection of Foreign Tax Credit and AMT

[mitbrehol]

What are the consequences of using a Foreign Tax Credit.  Behind the screen calculation, Turbotax reduced my $302 foreign tax credit to $259.  It talked about carryback or carryforward for the balance.  For that small amount I do not want to redo my 2022 taxes.  Will I be forced to?  I don't see that the ability to use it will be better in the future.  It is a stock that I do not intend to sell, so I will continue to pay this amount of foreign tax every year.  I have had this for 12 years and i have always been able to use the full amount, 

and never had that kind of information pop up before.  I am afraid to finalize my return.

It also says that once you make a decision you will have to abide by it from now on in future years.  There is no explanation as to the consequences or aggrevation that it will cause in the future.  I am at a lost as to what to do.

[MarilynG1]

If you were not able to use your entire Foreign Tax Credit, the remaining balance will be available for you to use in a future year as a carryover, as you mentioned. 

TurboTax will carry the balance forward for you, so no need to redo your 2022 taxes.  If you pay Foreign Tax every year on this stock, you will be able to continue to use the Foreign Tax Credit.

The maximum Foreign Tax Credit you receive is based on the amount of US Tax on the foreign income you received, which is why your credit may be reduced. 

The Simplified Method is when you claim the FTC without filing form 1116.  The penalty for doing this is you lose the right to claim any FTC carryover. 

Here's more details on Claiming the Foreign Tax Credit.