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Topic: Foreign tax credit carryover for AMT  (Read 1314 times)

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Foreign tax credit carryover for AMT
« on: January 12, 2017, 09:50:41 PM »
I file using Form 1116, for General and Resourced Income. I have had a low taxable income and have been getting FTC carryovers for the last 4 years.
I know how to figure them for Regular Tax. I've never been subject to AMT but will be in 2016 and would like to use the carryovers. They're not a lot considering what my tax liability will be but every penny helps. However I don't know how to figure AMTFTC carryovers. (I have a worksheet supplied by Tax Act although you do the calculations and input yourself).
My question is: For Regular tax, I take the Available Tax Credit and subtract the amount of foreign tax 'utilized', ie, applied to the current tax liability. The remainder or excess is the carryover for that year (that makes sense).  For the AMTFTC carryover for each year, do I do the same subtraction, ie, Available Tax Credit minus tax 'utilized'. Pub 514 would seem to suggest that you do (which doesn't make sense since i've never utilized any tax credits for AMT).
TaxAct doesn't know and IRS says they 'don't advise on that - you have to get a professional'. Has anyone had any experience with this? or know of a tax program that handles it. I learned an enormous amount from the people here a few years ago and again any help would be most gratefully appreciated.


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Re: Foreign tax credit carryover for AMT
« Reply #1 on: January 13, 2017, 10:56:41 AM »
For the last 4 years, have you filed an AMT return (form 6251) with accompanying AMT1116's?

My understanding, and I could be wrong, is normal 1116FTC's are a different animal to 1116AMTFTC's. To use the carryover for AMT, you need excess AMTFTC's. I believe, in general, calculations are the same (allowable available tax credits minus the "Limitation" amount equals excess credits for the tax year). AMT 1116's are calculated differently than normal 1116's (see instructions on 1116), although the form is the same.

When I've used carryover before, I've enclosed the "carryover calculations sheet" with the return. It's asked for in the instructions, but I don't know if a professional would include it. My guess is "yes".

Hopefully, someone with the knowledge will comment concerning FTC's for normal 1116's versus AMT1116's.



« Last Edit: January 13, 2017, 11:01:15 AM by theOAP »


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Re: Foreign tax credit carryover for AMT
« Reply #2 on: January 13, 2017, 07:23:08 PM »
No, I haven't filed AMT (6521) in the last 4 years. 2016 will be the first time, and probably only, time I'll file it (I sold my house and had a large gain).
Your treatment of the calculation is what Pub 514 suggests - do it the same way you do the calculation for Regular (non-AMT) tax. Would be nice if someone knew definitively.


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