Foreign Tax

[kevinr12240]

My 1099-DIV has foreign taxes paid in line 7 and "See detail" for line 8 (Foreign country or US possession).  The Foreign tax withheld in all the detail entries is “Various” rather than a specific country name.  The Foreign Income and Taxes Summary listing of all income has no entry for the country (the column is blank).  I enter “various” for the country in TurboTax.  What is confusing is that the next screen asks, “You still have some dividend income that hasn’t been reported to a country.  Do you want to continue so you can select a country to report dividend income on?”  I don’t have any other dividend income and there is no country given anywhere on the 1099 composite, so I answer, “No.”   Is this question just a safeguard?  Am I missing something or am I done with the foreign tax credit section? 

[KurtL1]

When entering the Foreign Taxes Paid on all your Form 1099-DIV is less than or equal to $300 ($600 if Married Filing Jointly). that you do not need to designate what country the Dividend income is from. The foreign taxes will be entered as tax credit.

If you need to report the income you need to look through the dividend listing from your investor and add the Dividend Income (not Qualified Dividend) to get the total income. Instead of entering different countries, you should enter RIC as the country.

[kevinr12240]

Thank you for your quick response..  I gather answering the questions as I did is correct.  I am curious, when does one indicate "Various" vs. "RIC" for the country?

[AmyC]

On the Form 1116. That is where the IRS wants the breakdown of the countries and the amounts. They announced 2 summers ago that their goal is to have everything by country but there is just no way with mutual funds it will ever happen, so they get RIC.

[kevinr12240]

Thank you for your response.  I don't think I was clear enough in my last question:  When no country name is given, when does one indicate "Various" and when does one indicate "RIC" when inputting foreign tax information?   TurboTax allows one to enter either "Various" and "RIC"  in the foreign tax section. 

[kevinr12240]

Perhaps I should say, WHY does one indicate 'Various" instead of "RIC" (and vice versa) when there is no country given?

[KarenJ2]

Mutual Fund shareholders are not required to report country by country detail. The code "RIC" should be used when completing foreign country information on Form 1116. See Form 1116 instructions for additional information.  I think various is what taxpayers used previously as the country.  The Form 1116 instructions now say to use RIC for income passes through from a mutual fund or other regulated investment company (RIC) on a country by country basis.

Form 1116 instructions  page 15:

You don't need to report income passed through from a mutual fund or other regulated investment company (RIC) on a country-by-country basis. Total all income, in the applicable category, passed through from the mutual fund or other RIC and enter the total in a single column in Part I. Enter “RIC” on line i. Total all foreign taxes passed through and enter the total on a single line in Part II for the applicable category. Because computations for inclusions under sections 951A and 965 are reported on separate forms, Form 8892, Global Intangible Low-Taxed income, and Form 965, Inclusion of Deferred Foreign Income Upon Transition to Participation Exemption System, you don’t need to report those inclusions on a country-by-country basis. For inclusions under section 965, in the applicable category, enter the total in a single column in Part l. Enter “965” on line i. For inclusions under section 951A, enter the total inclusion in a single column in Part l. Enter “951A” on line i.

[lebondav]

Is the foreign tax credit not allowed for self-employment situations 

[ErnieS0]

You can claim a foreign tax credit if you pay income tax or the equivalent to another country. However, you can’t claim a foreign tax credit on self-employment tax or the equivalent imposed by another country.

@lebondav