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Thanks. Having just completed my own 1116, I fully share
your opinion. It seems like they tried to design this form
to handle every conceivable case. All my foreign tax is on
equities/ mutual funds. Is there some reason to use
multiple columns? I don't see what it is accomplishing. A
few years ago I blew the $600 barrier, and I have no idea
how the form works, but the answer Turbotax came up with was
that I had to carry over some of my credit. I pushed the "I
believe" button. Now I am sentenced to keep doing this form
until I work off my carry over, or abandon my credit.

scott s.

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Form 1116 must be the most obsene form devised by any group
of apes. I have had to use it in the past MANY times and
decided that I would (mis) interpret it and let the chips
fall where they may. I never had a negative income but
often pondered over whether income included capital gains or
not, which alters the final amount alowable considerably.

Well, for about 12 years of filing for several entities
(persons and trusts) I was NEVER challenged on my
computations. I had carryforwards and used them or added
to them and interacted with other credits, and zero taxes
due and AMT, Capital gains and adjusted expenses, and even
deducted one credit in a country on their s___list
(SoAfrica) and NEVER got a blink out of the IRs.

I am firmly convinced that ir you can't understand ANY form
after reading it and its instructions, whatever you put on
the form will pass because the i___ts at the IRs won't be
able to figure it out either, and won't even know you erred,
let alone know how to challenge it. Do you really think you
will be audited for a 1116 form mistake? Whatever you r
problem, solve it to your advantage. Thank god for the
$300 / $600 waiver USE IT IF YOU CAN !!

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In filling out a Form 1116, you must allocate deductions
based on the ratio of foreign gross income to total gross
income. What if the US gross income is negative? Then the
ration of foreign to total income is greater than 1. I
could not find this covered in the instructions. Does this
mean that you must allocate MORE than the total deduction to
the foreign income? This sounds silly. Or should you then
use a fraction = 1, allocating all the deduction to the
foreign income?

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