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Requesting foreign tax credit where dividends reported on 1099-DIV

Forum|Forum|2 years ago
July 19, 2023
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I have dividends (on RSUs) reported on form 1099-DIV, but some of them are taxed abroad by my previous country of residence.

This tax is *not* reported on 1099-DIV.

How should I report this tax in Turbotax so that I can get foreign tax credit for them?

Thanks!

Best answer by pk12_2

@mark227 , so you are saying your case is as follows: (a) you a US person ( citizen / GreenCard ) lived and worked in a foreign country ( e.g. Germany ); (b) you had active income in that country and was able to exclude income under Foreign Earned Income exclusion; (c) you had US investment income generating passive income ( Dividends ) that was/ is being taxed by both the USA and the foreign taxing authroty because you were/is resident during the year 2022. Thus you now have a situation wherein the 1099-div issued by your US broker shows no foreign taxes paid and yet your foreign resident country has indeed taxed this passive income.

If this is your situation ( and please explain your situation such as when did you establish and relinquish foreign tax home, your citizenship / greencard status; which country are we talking about etc. etc., ) then generally the only way around this is to use form 1116 and essentially resource your applicable US sourced passive income to foreign income for purposes of form 1116.

Please answer my questions and I will circle back on this.

pk

P

pk12_2Answer

Employee

@mark227 , so you are saying your case is as follows: (a) you a US person ( citizen / GreenCard ) lived and worked in a foreign country ( e.g. Germany ); (b) you had active income in that country and was able to exclude income under Foreign Earned Income exclusion; (c) you had US investment income generating passive income ( Dividends ) that was/ is being taxed by both the USA and the foreign taxing authroty because you were/is resident during the year 2022. Thus you now have a situation wherein the 1099-div issued by your US broker shows no foreign taxes paid and yet your foreign resident country has indeed taxed this passive income.

If this is your situation ( and please explain your situation such as when did you establish and relinquish foreign tax home, your citizenship / greencard status; which country are we talking about etc. etc., ) then generally the only way around this is to use form 1116 and essentially resource your applicable US sourced passive income to foreign income for purposes of form 1116.

Please answer my questions and I will circle back on this.

pk

M

mark227Author

Thanks @pk12_2

@pk12_2 wrote:
Thus you now have a situation wherein the 1099-div issued by your US broker shows no foreign taxes paid and yet your foreign resident country has indeed taxed this passive income.

This is correct, though I was not a resident of that foreign county in 2022 (I was US resident). The foreign country taxed that 2022 income because I was a resident of that country 4 years ago when I was granted these RSUs

Your answer makes sense to me.

Please let me know whether it changes in light of my clarification above.

thanks again!

P

pk12_2

Employee

@mark227 , I cannot look up the tax treaty between US and the country you were a resident of ( their action slightly surprises me ) -- don't know which country ( are you a citizen of that country or of USA ? ).

But my earlier generally does not change ( absent any treaty assertions/ conditions ).

Is there more I can do for you?

pk