Whether you are an individual, a company or entity, or a financial institution doing business or residing abroad, keeping track of your foreign taxes paid and knowing how to utilize your foreign tax credits can be a daunting task. Under U.S. tax law, U.S. companies, U.S. citizens and U.S. tax residents that pay foreign taxes on foreign source income may take a foreign tax credit on any U.S. income tax on such income. However, you may not claim a tax credit for foreign taxes paid on any foreign source income that has been excluded from U.S. tax, such as under the foreign earned income exclusion or the foreign housing exclusion.
Due to certain limitations under the foreign tax credit rules, many U.S. companies, and some U.S. citizens and U.S. tax residents, are not able to fully use their annual foreign tax credit. However, any foreign tax credit amount in excess of the maximum foreign tax credit limitation may be carried back to the immediately preceding tax year or carried forward to a future tax year for up to ten years.
The Law Office of Deborah J. Jacobs has significant experience in foreign tax credit planning. We can help you assess your current foreign tax credit utilization and suggest strategies to help you increase your future foreign tax credit utilization.
We look forward to working with you to resolve your international tax matters. |
The Law Office of Deborah J. Jacobs, located in New York City, represents clients worldwide on international tax matters under the tax laws of the United States. Our practices areas consist of International Tax Compliance (including, but not limited to, Offshore Voluntary Disclosure Programs, Streamlined Offshore Compliance Procedures ((both Domestic and Foreign)), Dual Citizenships, FBAR Compliance and FATCA Compliance) and International Tax Planning (including, but not limited to, Cross-Border Transactions, Tax Treaty Planning, Foreign Tax Credit Planning, Repatriation Planning and Deferral Planning). Our clients are individuals, foreign companies and entities, and financial institutions doing business or residing in the United States, or individuals, U.S. companies and entities, and financial institutions doing business or residing abroad. We look forward to working with you to resolve your international tax matters. Attorney Advertising.