form 1116

[grandmabee]

form 1116 not ready yet. but I have a 1099-div with foreign tax with held. Per instructions I can just put on 1040 without using the 1116. meets all exceptions. ( under 300, shown on 1099-div etc...) But when I use the 1116 is gives me a lower tax credit than if I just go the 1040. What am I missing?

[kcjenkins]

Why would you want a lower tax credit, which means a higher tax?

[grandmabee]

Why would you want a lower tax credit, which means a higher tax?

I don't want a lower tax credit. What i was asking is if you don't use the 1116 you get more credit and if you use the 1116 you get a lower credit. Why is that?

[kcjenkins]

Probably missed checking some box, or answering some question, would be my guess.

[David1980]

By making the election to claim foreign income taxes paid without filing Form 1116, the foreign tax credit limitations do not apply. Those are lines 14-20 of Form 1116. So if it's being limited by something in there the election to not complete Form 1116 can create a better tax benefit.