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Amending my 2007 return

I filed my 2007 return in April 08. I amended it in October 09.

I have a great deal of foreign tax credit, but not enough income to use it. I did have income in 2007, so I decided to carry my 2008 credit back to 2007 by filing a second amended return in April 11 rather than carrying it forward and never using it.

Last month I called them because I hadn't heard anything about it. They said they received it but had not acted on it, but would get back to me. Friday I got a letter that said "your claim was incomplete for processing. Also, that you cannot put various on Line 1 of your Form

1115. We also need the name of the country for which you are taking the credit. Please resubmit the claim." Obviously it is more than three years since I filed my first return. 1) Does the 3 year clock run from April 08, October 09, or is there no clock to fix the error since the second amended return was filed in time? 2) The countries are many and perhaps unknown, since mutual funds were involved. I always put "various" before and never had a problem. What is the correct action? 3) As they wrote their letter, would you think I have a problem beyond "various"? If so, how do I know what it is?
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Confused
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I called the IRS. She "thinks" my only problem is not listing the specific countries. I told her that my statements just say "Various" and I have no idea what countries are involved; I am reasonably sure that "various" is the normal entry. She transferred me to someone more knowledgeable than she.

He told me that mutual funds can say "various", but specific stocks need countries. Apparently some countries qualify and others don't. (anyone know about that?) If the statements only say "various" and I don't know what countries the stocks are in, then I am simply out of luck.

Other than just listing a few countries at random, I am not sure what to do. There are maybe 50 stocks involved. I guess Siemens is in Germany, but I don't even know how I would determine that.

Any advice?

Reply to
Confused

If the country is on the known terrorism list then the foreign tax credit is not allowed.

BEGIN QUOTE publication 514

Exceptions for foreign taxes not allowed as a credit. Even if you claim a credit for other foreign taxes, you can deduct any foreign tax that is not allowed as a credit if:

  • You paid the tax to a country for which a credit is not allowed because it provides support for acts of international terrorism, or because the United States does not have diplomatic relations with it or recognize its government,

END QUOTE

Looks like the countries are

BEGIN QUOTE

formatting link
Cuba March 1, 1982

Iran January 19, 1984

Sudan August 12, 1993

Syria December 29, 1979

END QUOTE

Strange that North Korea is not on the list.

Siemens is in many countries. The detail section of the 1099-DIV often lists the countries involved. The reason form 1116 needs a country is that each country has a different tax rate. So if country1 tax rate is 5% of income and country2 tax rate is 50%, and your US effective tax rate is 23%, then you'd get the full tax credit for country1 but not for country2.

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removeps-groups

I appreciate your reply. An accountant I spoke to says they always just put "various" and the IRS has never questioned it. Does the IRS just not bother with it ordinarily, or is this guy just getting extremely lucky?

Also, what about the 3 year cut off; does that apply to correcting my return?

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Confused

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