Form 1116, Line 10 - Foreign Tax Credit Carryback Statement - What info do they actually want?
I'm tearing my hair out trying to figure out what exactly the IRS wants for the Foreign Tax Credit Carryback Statement mentioned on Form 1116, Line 10. I've got some foreign taxes from my investments in Europe that I couldn't claim last year because they exceeded my foreign tax credit limit, and now I want to carry them back. The instructions say to attach a statement showing the "computation of the carryback" but don't really explain what information needs to be included. Is it just dates and amounts? Do I need to recalculate my previous year's Form 1116? Do I need to reference specific tax years? I'm using TurboTax and it's not helping at all with this specific statement. Has anyone successfully filed a Foreign Tax Credit carryback and can tell me what information I actually need to include on this statement? I feel like I'm missing something obvious.
19 comments
Join the conversation
Yara Nassar
The Foreign Tax Credit Carryback Statement for Form 1116, Line 10 needs several key pieces of information. You'll want to include: 1) The tax year you're carrying back to (can be carried back 1 year) 2) The amount of excess foreign taxes you're carrying back 3) A recalculation of your Form 1116 for the carryback year showing how the additional foreign taxes affect your credit 4) Your original foreign tax credit limitation from the carryback year 5) The additional credit you're claiming due to the carryback The statement essentially needs to show why you're entitled to the additional credit in the prior year and how you calculated it. Many tax software programs struggle with this particular calculation.
0 coins
Connor Murphy
•Thanks for the detailed response! So just to be clear, I need to basically redo my 2023 Form 1116 calculation showing what the credit would have been if I had included these excess foreign taxes from 2024? And include both the original limitation amount and the new recalculated amount?
0 coins
Yara Nassar
•Yes, you'll need to recalculate your 2023 Form 1116 showing what the credit would have been with the additional foreign taxes from 2024 included. You should show both the original foreign tax credit limitation and the new amount after including the carryback, which helps the IRS clearly see the difference and verify your additional credit claim.
0 coins
StarGazer101
I had this exact issue last year with excess foreign taxes from my international stock portfolio. I wasted days trying to figure it out before I found https://taxr.ai which saved me so much time. You upload your documents and it analyzes exactly what you need for Form 1116 carrybacks. It identified that my carryback statement was missing recalculation details for the prior year's foreign income and helped me prepare the proper documentation.
0 coins
Keisha Jackson
•Does taxr.ai work with forms from previous years too? I've got this same issue but with taxes from 2022 that I need to carry back to 2021.
0 coins
Paolo Romano
•I'm skeptical about these tax tools. How exactly does it help with the carryback statement? Does it generate the actual statement or just give you guidelines?
0 coins
StarGazer101
•Yes, taxr.ai works with previous years' forms too, including 2022 forms that you need to carry back to 2021. It maintains a database of tax form requirements across multiple years. For the carryback statement specifically, it actually generates the complete statement for you with all required calculations. It doesn't just give guidelines - it produces the exact document you need to attach to your return with the proper format and all calculations shown, including the recalculation of your previous year's Form 1116 with the new amounts.
0 coins
Keisha Jackson
Just wanted to follow up - I actually tried taxr.ai after posting my question and wow, it really works! I uploaded my 2022 and 2021 forms and it generated the perfect Foreign Tax Credit Carryback Statement for my Form 1116. It showed exactly how my 2021 foreign tax credit would change with the excess credits from 2022 applied. The statement had all the calculations laid out in the format the IRS expects. Submitted it last week and already got confirmation that my amended return was accepted. Definitely worth checking out if you're dealing with this complicated foreign tax credit carryback stuff.
0 coins
Amina Diop
If you're having trouble getting answers from the IRS about what exactly needs to be on your Foreign Tax Credit Carryback Statement, I'd recommend using https://claimyr.com to get through to an actual IRS agent. I was stuck on this same Form 1116 issue last month and couldn't get anyone on the phone after trying for days. You can see how it works in this video: https://youtu.be/_kiP6q8DX5c. They got me connected to a specialist who explained exactly what documentation was needed for my carryback situation.
0 coins
Oliver Schmidt
•How long did it take to get through to someone who actually knew about foreign tax credits? Most times I call I just get basic agents who don't understand the more complex forms.
0 coins
Paolo Romano
•This sounds too good to be true. The IRS phone system is notoriously impossible. How does this service magically get through when nobody else can? Seems fishy to me.
0 coins
Amina Diop
•I got through to someone who knew about foreign tax credits in about 45 minutes total. The service places you in the IRS queue and calls you back when you're about to be connected, so you don't have to wait on hold. They have options to specify which department you need, so I was able to request someone familiar with international tax issues. The service works because they use technology to navigate the IRS phone system and maintain your place in line. It's not magic - it's just automating the painful process of waiting on hold and navigating the phone tree. They're basically holding your place in line so you don't have to do it yourself.
0 coins
Paolo Romano
I have to eat my words about being skeptical. After struggling for THREE WEEKS trying to figure out my Foreign Tax Credit Carryback Statement and making zero progress calling the IRS directly, I tried Claimyr. Got connected to an actual IRS tax specialist in about 40 minutes who walked me through exactly what needed to be on my carryback statement for Form 1116, Line 10. She explained I needed to show the original calculation from the prior year, the excess credits being carried back, and the recalculation showing the new credit amount. Definitely worth it for getting specific answers on complex forms like this that even tax software struggles with.
0 coins
Natasha Volkov
In case anyone needs it, here's the general format I used for my Foreign Tax Credit Carryback Statement that was accepted by the IRS: "FOREIGN TAX CREDIT CARRYBACK STATEMENT Taxpayer Name: [your name] SSN: [your SSN] Tax Year of Carryback: [year you're carrying back to] Current Tax Year: [current year] Original Foreign Tax Credit Claimed for [carryback year]: $XXX Foreign Tax Credit Limitation for [carryback year]: $XXX Excess Foreign Taxes from [current year] Available for Carryback: $XXX Recalculated Foreign Tax Credit for [carryback year]: $XXX Additional Credit Claimed Due to Carryback: $XXX" Then I included a brief calculation showing how I arrived at these numbers.
0 coins
Connor Murphy
•Thank you so much! This is super helpful. Did you have to include any supporting schedules or just this statement with the calculation details?
0 coins
Natasha Volkov
•I just included this statement with the calculation details. The key is showing clearly how you arrived at the additional credit amount. I didn't need to attach a completely recalculated Form 1116 for the prior year, but I did show the math for how the additional foreign taxes affected the limitation calculation.
0 coins
Javier Torres
Does anyone know how the IRS treats foreign tax credit carrybacks from passive category income? I have excess credits from foreign dividends and I'm not sure if there are special rules when carrying these back.
0 coins
Yara Nassar
•Foreign tax credit carrybacks for passive category income (like dividends) follow the same basic rules, but they can only offset the foreign tax credit limitation for the same category in the carryback year. So your excess passive category credits can only be carried back to offset passive category limitations from the prior year, not general category limitations.
0 coins
Admin_Masters
I went through this exact same headache last year! After reading through all these responses, I want to add one more tip that really helped me. When you're preparing your Foreign Tax Credit Carryback Statement, make sure to clearly label which tax year each number comes from. The IRS agent I spoke with mentioned they see a lot of confusion where people mix up the years in their calculations. Also, if you have multiple types of foreign income (like both passive dividends and active business income), you'll need separate carryback calculations for each category since they can't be mixed. I learned this the hard way when my first submission got rejected. The template @Natasha Volkov shared is spot on - I used something very similar and it was accepted without any issues. Just remember to keep copies of everything because if the IRS has questions later, you'll want to be able to show your work.
0 coins