I seem to have a conflict of interest between me as trustee and as tax preparer, so I thought I'd ask here.
The instructions for the foreign tax credit seem to allow changes to be made between electing to use the credit or to deduct the foreign taxes up to 10 years back. Considering the changing laws as to when carryforwards and carrybacks (one year) are absorbed or not, determining the best result seems to involve (at least) 1024 combinations.
My questions: (1) Is that 10-year rule actually correct?
(2) Have the laws on carryforwards and carrybacks _actually_ changed. If so, it what years is a 1116 carryback or carryforward dropped if the 1116 is not filed in the carryback/carryforward year, and in what years is it absorbed only to the extent that it would be absorbed if a
1116 was filed in the year, or some other state of law.(3) If a trust return is amended to include/exclude the 1116, do the beneficiaries have to recompute their tax returns?
(4) What should I do if my estimate of a fair price to prepare the trust's return exceeds the benefit to the trust?