form 1116
#1
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form 1116
Examining the tax preparer's tax return they have completed for me ( US person here - so need to file both uk and usa) ......a bit puzzled by the appearance of a form 1116 claim for shares dividends I received {around 100 gbp} I was under the impression as I don't pay tax on the dividend in the UK ( because the threshold is 2,000 gbp) then I cannot claim for it -and I will have to pay the US tax on it even though i live in UK. Am I wrong?
Last edited by brokenhearted.; Jul 21st 2019 at 7:43 pm.
#2
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Re: form 1116
Examining the tax preparer's tax return they have completed for me ( US person here - so need to file both uk and usa) ......a bit puzzled by the appearance of a form 1116 claim for shares dividends I received {around 100 gbp} I was under the impression as I don't pay tax on the dividend in the UK ( because the threshold is 2,000 gbp) then I cannot claim for it -and I will have to pay the US tax on it even though i live in UK. Am I wrong?
Calculating the Foreign Tax Credit In Three Easy Steps - Deblis Law
#3
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Re: form 1116
Doubtless they are calculating foreign source income in case there is a carryback from the 2019 return. More importantly have they correctly treated it as qualified?
#4
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Re: form 1116
Many thanks for your replies.....the box at the bottom of the 1116 has been ticked as paid rather than accrued so I that was the bit that bothered me .....but they have put them as qualified.
I am beginning to think I should surrender to their better judgement and let the part of me that I recognise as control freak go - however I did have to point out the land sale that took place ths April really shouldn't be used this year and that my deceased husband was born before 1954 - which they admitted would increase the allowance for joint filing by $1300. So as much as I want just to let them get on with it but I am torn with the notion given some errors that seem very silly to miss
I am beginning to think I should surrender to their better judgement and let the part of me that I recognise as control freak go - however I did have to point out the land sale that took place ths April really shouldn't be used this year and that my deceased husband was born before 1954 - which they admitted would increase the allowance for joint filing by $1300. So as much as I want just to let them get on with it but I am torn with the notion given some errors that seem very silly to miss
#5
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Re: form 1116
I agree. It seems shocking they failed to enter your late husband's date of birth in their software. Paid is correct for the 1116 unless you (irrevocably) elected in a previous year for the accrued method.
#6
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Re: form 1116
Thank you - this is my first year of filing both uk & us taxes - decided it was beyond me at this time but i might feel different once everything settles down. A lot of dribs and drabs as I closed and drew down things ( a small TD Ameritrade stock account), one off payment for unused holiday & sick leave, TSP, along with small amounts on interest. I have to trust the tax guy but i plan to slim down my income streams it should get less of a pain to understand. I was just puzzled as I had read you can only claim a tax credit provided you pay tax in the other country - so my UK shares dividend was below the UK threshold for tax so it feels a bit wrong that I get a tax credit when i didn't pay tax on them in UK.. I think it is a steep learning curve!