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Posted by Jeff on April 6, 2008, 6:59 pm
Please log in for more thread options > In misc.taxes.moderated, Jeff wrote:
>
>>> In misc.taxes.moderated, Jeff wrote:
>>>
>>>>
>>>> I am using TaxCut to prepare my taxes. Because my 1099 DIVs had
>>>> total "Foreign Taxes" of $743, TaxCut told me I need to fill out a
>>>> Form 1116.
>>>>
>>>> TaxCut automatically transferred the Foreign Taxes from my K1s to
>>>> the 1116, but left me to fill out the amounts ($743) from my 1099
>>>> DIV and flagged it an error till I did so. I therefore entered
>>>> $743 in the mini-worksheet of "Part II" which transferred it to
>>>> "c" column o and s totaling 743 on Form 1116 line 8.
>>>>
>>>> BUT, that immediately increased (!) my "taxes due" by $776 from
>>>> what it had been before I did this. That does not make sense to
>>>> me. I would think that if I paid these foreign taxes, it should
>>>> reduce taxes due to Uncle Sam not increase it. So I must have done
>>>> something wrong. The 743 is the only figure I entered on the 1116.
>>>> Should I have entered something else elsewhere? If so, where?
>>>
>>> Lines 3a,3c, 3d, 3e, etc... , 8,9, etc...
>>>
>>>
>>>>
>>>> I am very confused.
>>>
>>> This is a confusing form.
>>>
>>>> There are no other errors according to TaxCut's
>>>> final error check.
>>>
>>> I suspect that there is a different choice you could have made to
>>> cause Taxcut to make the 1116 entries itself from the 1099 and K-1
>>> numbers rather than you having to fill it out on your own.
>>
>> Thanks for replying, but unfortunately that choice did not exist for
>> the 1099 DIVs. I will look for it again.
>>
>
> So are there some 1099-DIV or 1099-INT choices for block 6 in your
> TaxCut program? Perhaps you choose which 1116 form copy this will go
> on to. You will probably have to supply the foreign source amount
> included in dividends. That amount will probably be between 6.6 to
> 10 times the amount from line 6 of the 1099-DIV or 1099-INT you
> received.
>
> You would want to try a search at http://taxcut.com/
I'll work with it.
Incidentally, why are there 2 copies produced of the 1116? Would one be
to calculate AMT and the other for regular tax?
Jeff
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