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I have entered dividend income. I also entered taxes paid on that income. But turbotax still shows tax owed. Does anyone know why turbotax is still showing taxes owed?

Forum|Forum|3 years ago
January 24, 2023
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TurboTax Online

Best answer by ZhuoliA

You should report foreign tax paid on the dividend income in the foreign tax box (Box 7), as your Form 1099-DIV suggests. If you paid federal tax on the dividend income, you could enter that into the federal tax box. The federal tax will count towards the prepayment of income taxes and lower your tax due. Foreign tax paid will count toward foreign tax credit and may not directly lower your tax liability.

If the foreign taxes are under $600 for married or $300 for single filer, you only need to enter the form 1099-DIV to get the foreign tax credit. Otherwise, you need to answer the questions in the "Foreign Taxes" section in TurboTax, which is under "Estimates and Other Taxes Paid" in the "Deductions and Credits" section of TurboTax.

You can follow the steps below to see the foreign tax credit on your return by previewing your form 1040.

1. Select Tax Tools from the menu (if you don't see this, select the menu icon in the upper-left corner)

2. With the Tax Tools menu open, you can then:

View only your 1040 form: Select Tools. Next, select View Tax Summary in the pop-up, then Preview my 1040 in the left menu.
Find the foreign tax credit amount on Schedule 3 - Additional Credits and Payments, Line 1.

M

mglauner

It could be that you owe tax on your other income (besides the dividends) or that the tax paid on your dividends was not sufficient for your total income amount.

On the left-side menu, click on Tax Tools > Tools, then 'View Tax Summary' from the pop-up menu.

Back on the left-side menu, choose 'Preview my 1040' to see your full return.

F

fakkar01Author

Thank you for your reply. I should perhaps clarify that it is foreign earned dividend and the tax amount I entered was in the foreign tax box (box 7).

if I enter a figure in the Federal Rax box the turbotax does take it into account. But not when I enter the figure in the foreign tax box.

Z

ZhuoliAAnswer

You should report foreign tax paid on the dividend income in the foreign tax box (Box 7), as your Form 1099-DIV suggests. If you paid federal tax on the dividend income, you could enter that into the federal tax box. The federal tax will count towards the prepayment of income taxes and lower your tax due. Foreign tax paid will count toward foreign tax credit and may not directly lower your tax liability.

If the foreign taxes are under $600 for married or $300 for single filer, you only need to enter the form 1099-DIV to get the foreign tax credit. Otherwise, you need to answer the questions in the "Foreign Taxes" section in TurboTax, which is under "Estimates and Other Taxes Paid" in the "Deductions and Credits" section of TurboTax.

You can follow the steps below to see the foreign tax credit on your return by previewing your form 1040.

1. Select Tax Tools from the menu (if you don't see this, select the menu icon in the upper-left corner)

2. With the Tax Tools menu open, you can then:

View only your 1040 form: Select Tools. Next, select View Tax Summary in the pop-up, then Preview my 1040 in the left menu.
Find the foreign tax credit amount on Schedule 3 - Additional Credits and Payments, Line 1.