Form 1116

[Christian]

I have taken on a client who has a Foreign Tax Credit from 2021 which he had to carryover to this year. I looked to see if I might place it on Schedule B of the 1116 as a carryover but do not see an applicable line. I can count on one hand the number of Form 1116s I have prepared. The amount involved is some $347. His info indicates none of his funds had any Foreign Tax taken out in 2022. I am just wondering if I may put it on Schedule 3 of Form 1040 on line z identifying it as a carryover from 2021 ?

[Abby Normal]

Bring up the Pages & Worksheets list and choose Sch B (1116) - Credit Carryback / Carryforward

[Christian]

MANY thanks Abby as it looks like it will give them the credit. The form is a real labyrinth ! 

[Sara EA]

Just make sure he had some foreign income, details of which should be buried in the brokerage statement somewhere.  The credit only applies to foreign income so the carryover will reduce the US taxes on that income.  I had a client with several thousand in FT credit carryovers who kept questioning me about why I wasn't applying them.  He had liquidated all his mutual funds and had no foreign income, so the carryover was wasted after ten years.