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Old 04-07-2017, 11:43 AM
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Smile Foreign Tax Credit

Since 2012, I was able to get a foreign tax credit every year based on 1099 DIV information; unfortunately some were carryover to the next year, so in 2015 the accumulated carryover (2013-2015)was $916.00

In 2016, the 1099 DIV showed ordinary dividend $2010 and qualified dividend $2010. There were Fed Tax withheld of $596.00 and foreign tax paid $639.00 but I was unable to get any foreign tax credit. This was the first time that I was able to itemized their tax return.Their adj income for 2016 was $192,047. I don't know if there was a glitch with the software, so i began to manually entered the figures, and was able to get the credit; however, the credit was less than what I was getting when I itemized the return (using the past carry forward amount $916.00 + $639=$1555.00)
Once I do that, and remove the entries from form 1116 and entering it unto Sch A, form 1116 does not print since there is no information shown on it.so my questions are as follows:

1. I am required to file form 1116 once foreign tax paid in 2016 exceeds $600.00 with passive income but since that form no longer showing up on my client's tax return, what should I do?

2. Was that a software error before manually entering that information?

I know it's a long explanation but would appreciate it very much if you can enlighten me about it.

Thank you



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