2573991
I updated Turbotax (Windows Desktop, Premier) today. I have not changed any input of my data.
After the Mar-11-2022 update (that included Schedule B of 1116, but not update on this 1116 Comp Wks), now I get an error in 1116 Comp Wks (Foreign Tax Credit Comp Wks)
“Incoming C/O Utilized should not reduce the foreign taxes below 0.”
at “Utilized” for 2020.
I am not sure what is the indication of the error (I did not get this error before the update Mar-11-2022).
In the wks, in the line 2020, my “Utilized” is higher than “Foreign Taxes” because the carryover credit from 2019 was used.
When I try changing “Utilized” to be same as “Foreign Taxes” for 2020, the error disappears. (for testing. It is not true. )
Any advice would be highly appreciated.
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I have the same issue, were you able to resolve this?
If your return has been rejected regarding Form 1116B, please know that the issue is being resolved in a product release scheduled for March 18, 2022. Your tax return now includes updated information to carryover of foreign taxes. On or after March 18 you'll need to sign into TurboTax, complete a quick review (steps below), and resubmit your return. Please note this is just for your federal 1040 tax return. To review and re-submit your return, follow these are the steps if you're using a CD or downloaded version of TurboTax:
Note: The calculation change may affect your refund.
After contacting Turbotax support they instructed me to do as follows:
1. go back to the page in which I filed out the amounts of foreign tax utilized in each year
2. for each year in which the "utilized" value is higher than the "foreign tax" value, I should instead set utilized to be the same as the foreign tax, and the difference should be included in the "utilized" from a previous year (I assume it's better to add to the earliest year, so you get to retain the carryovers for longer).
I hope that helps.
thank you for the comment and for the comments, @victor29 Victor. Cheers.
@GeorgeM777 George, thank you for the reply. I will get the update and see what will happen. Cheers.
Ignore post. (Wanted to delete my original reply but can only edit. I might have figured something out on this topic and will revert with info if it checks out.)
I have the exact same issue. Actually governing numbers for 2018 calculated and considered correct by several previous Turbo Tax versions. I admit that I am a bit suspicious of the suggested workaround and would hope someone at Turbo Tax might be reviewing this issue (and it might just be a software bug).
Form 1116 - Foreign Tax Credit Comp Wks: Incoming C/O Utilized should not reduce the foreign taxes below 0.
However, the suggested solutions seems unreasonable. I guess it's the minimal way of fixing a Turbo Tax bug by changing the tax return without changing the information relevant for the present, but the resulting Schedule B for from 1116 seems correct when Turbo Tax throws out the error and doing the suggested adjustments modifies the Schedule B to give the same overall current tax credit carryover but no longer the correct historical distribution in accordance with previous filings.
I talked to both tax experts for the desktop version and online tax experts and none of them seem to understand what is going on. My best guess would be a system bug that came with the update. in my case the error is even governing the year 2018, which was calculated and considered correct by several previous Turbo Tax versions.
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