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March 21, 2020
Question

Foreign Tax Credit

  • March 21, 2020
  • 1 reply
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I paid foreign tax resulting from dividend income from a foreign stock and also from a Vanguard International Stock fund distribution. My TurboTax return shows the one from the foreign stock is shown on Schedule 3 Part 1 as a foreign tax credit. The Vanguard item is reported as foreign taxes on Schedule A Line 6. Is this okay or should they both be in the same place? 

    1 reply

    March 21, 2020

    Yes, this is okay. 

     

    By law, you can claim either a tax credit or a deduction on the foreign tax you pay.  It is allowed to have a credit calculated on Schedule 3 from one set of foreign tax and deduction on the Schedule A from the other amount of foreign tax separately.  As long as there is no double-dip, you are good to go.