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"Detailed Computations" for Foreign Tax Credit Carry Forward (line 10 -1116)

Last year I paid $501 in foreign tax and form 1116 (line 20) says I can take $561 maximum. I paid $483 in 2008 that I was unable to use because I paid no tax in

2008 (or 2009). I want to carry $60 of it forward to 2010. Line 10 says to attach detailed computations. Other than a statement that I am carrying forward $60 from 2008, what sort of computations do they want? I have read through the instructions repeatedly, but don't see any computations required.

If they designed this to be maddening, they have succeeded. Thanks for your help.

Reply to
Toller
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I recently encountered this on Form 1116. My understanding is that it is just the carryover calculation. If you have only one year, it is trivial. I'm using TurboTax and they already provide a carryover worksheet, which I believe is supplied to the IRS, so this statement would just be a duplicate.

1116 is indeed a maddening form. I have another 1116 issue, which may bite you if you have margin interest expense. You have to allocate margin interest expense between the adjusted basis of foreign and domestic assets.

In order to do this precisely, you would need to take into account every transaction in your portfolio throughout the year. This would be an absolute nightmare. So I'm just estimating it by doing the calculation for the last day of the year. I hope this is acceptable. If you have had to deal with this, I'd like to know how you did the calculation.

Reply to
Todd

Todd was kind enough to send me a Turbotax worksheet on carryforwards,and I read through Pub 514. I guess a chart showing allowed and taken is all you need. But...In example one of Pub 514 it says you must carry the credit backwards before you can can carry it foreward. Is that true? One of my son's has $150 in 2008 he could carry back to 2007, but it doesn't seem worthwhile filing an amended return for the $150. In a few years he should be earning some money that would let him carry it forward. Do I have to carry it back or lose it? What is the deadline for carrying it back? Three years from filing (which is this week...) or longer?

Reply to
Toller

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