Foreign Tax Credit: A Comprehensive Guide
The Foreign Tax Credit (FTC) is a nonrefundable tax credit available to U.S. taxpayers who pay income taxes to a foreign government on income that is...
File Form 1116 to claim the foreign tax credit if you are an individual, estate, or trust, and you paid or accrued certain foreign taxes in a foreign country or a U.S. possession.
>> Download or print Form 1116
You may obtain a credit for excess income and profits taxes paid or accrued during your taxable year in any foreign country or U.S. possession, or any political subdivision (for example, city, state, or province) of the country or possession. This includes taxes paid or accrued in lieu of taxes on foreign or possession income, war profits, or excess profits that are otherwise generally imposed. For purposes of the credit, U.S. possessions include Puerto Rico, the United States Virgin Islands, Guam, the Northern Mariana Islands, and American Samoa.
U.S. citizens living in certain treaty countries can get an additional foreign tax credit for foreign taxes imposed on certain U.S. income. If this applies to you, consult with your trusted accountant (CPA) to help you navigate the tax difficulties of your situation.
At H&CO, our experienced team of tax professionals (CPAs) understand the complexities of income tax preparation and are dedicated to guiding you through the process. With a personalized approach, we help you navigate US and international income tax laws, staying up to date with the latest changes.
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