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Old 03-04-2017, 07:31 PM
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How do apply foreign tax carryover credits?

I have a foreign tax credit carryover to 2016 from 2015 and also paid foreign tax in 2016. Do I utilize the 2016 amount for the 2016 credit first and then the carryover amount from 2015 OR do I use the 2015 carryover amount first and then the 2016 amount?
For example, 2015 foreign tax carryover is $75 and 2016 foreign tax paid was $100. I am eligible to take a $60 credit in 2016. Do I apply this credit to the 2015 carryover so that the remaining 2015 carryover is $15 and the 2016 carryover to 2017 would be $100? Or, does the 2015 carryover remain at $75 and the 2016 carryover becomes $40?



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Old 03-05-2017, 10:03 AM
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I have a foreign tax credit carryover to 2016 from 2015 and also paid foreign tax in 2016. Do I utilize the 2016 amount for the 2016 credit first and then the carryover amount from 2015 OR do I use the 2015 carryover amount first and then the 2016 amount? ========>those can be carried forward up to 10 years/ you need to apply the excess to the earliest year( if you have FTC this year then this year first) to which it may be carried. Then, apply it to the next earliest year, and so on. The carryback-carryforward period cannot be extended even if you are unable to take a credit in one of the intervening years.


For example, 2015 foreign tax carryover is $75 and 2016 foreign tax paid was $100. I am eligible to take a $60 credit in 2016. Do I apply this credit to the 2015 carryover so that the remaining 2015 carryover is $15 and the 2016 carryover to 2017 would be $100? Or, does the 2015 carryover remain at $75 and the 2016 carryover becomes $40?=>As mentioned above.



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