New guidance for foreign tax credit allocation and apportionment of deductions

In May of 2021, the IRS released a practice unit for foreign tax credit allocation and apportionment of deductions. Practice units are training materials for IRS employees that provide specific guidance on certain tax issues. These practice units are not to be relied on as official regulations but are used more to assist IRS employees …

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Foreign Tax Credit – Individuals

If your investment portfolio includes holdings outside of the U.S., it is not uncommon to see foreign taxes withheld on the foreign sourced income it generates.  Generally, you may claim a credit for foreign taxes if the following four tests have been met: 1. The tax must be imposed on you 2. You must have paid or …

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