Foreign-Source Income for Vanguard VXUS

Forum|Forum|4 years ago
March 6, 2022
1 reply
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I am still confused about what to enter for foreign-source income for Vanguard.

I have had 3 funds in Vanguard in 2021 (VTI, VXUS and VWLUX) out of which only VXUX had "Foreign tax withheld-Various"

"VXUS Dividends+distributions"=$8000,

"total dividends+distributions"=16000,

Box 1a (Total Ordinary Dividends in 1099-DIV)=$15000

Box 1b (Total Capital Gain distributions in 1099-DIV)=$1000

Vanguard tax form did not provide foreign source income, but provided below:

FOREIGN SOURCE INCOME PERCENTAGES
Fgn Source Inc Tot 90.34% Fgn Source Inc Qual 64.50%

Turbo Tax "Foreign-Source Income" screen says : You reported $16000 of total iincome from Vanguard. How much of this income was from foreign countries?

Question:

Which of the following should I provide for Foreign source income?

Option 1) (Total Dividends+distributions*90.34%) = (16000*90.34/100) or

Option 2) (Box 1a*90.34%) = (15000*90.34/100) or

Option 3) (VXUX Dividends+distributions*90.34%) = (8000*90.34/100) ?

Thanks a lot!

Not A Product Question

Best answer by DavidD66

You should use option 3, VXUS Dividends & distributions ($8,000 * 90.34%).

DavidD66Answer

You should use option 3, VXUS Dividends & distributions ($8,000 * 90.34%).

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platenscrews

DavidD66, I have seen you answer this question two different ways.

https://ttlc.intuit.com/community/taxes/discussion/vanguard-foreign-qualified-dividends-and-l-t-capital-gains/00/2554697

The link above shows you using the lower percentage. The .645 noted as Foreign Source Income Qualified.

But here you are recommending the higher percentage of .9034. Can you please clarify?

DaveF1006

It depends. This has two different types of dividends, ordinary dividends reported in Box 1A and qualified dividends reported in Box 1B. Here is how to determine the total amounts of your foreign dividends.