If you don't have foreign income this year you can't use a
carryforward tax credit. You're saying if you didn't have
general income you can't take the general carryover, even
though you had passive income? No one at the first or
second level in the IRs could figure this out so I would
lump them together and play dumb if they catch you (if this
is your only problem).

annonomuos

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Larry Israel wrote:

- quote -

You once again complete two forms: one for passive income
and one for general limitation income (GLI). The
carryforward gets entered on line 10 of page 2. As you have
no GLI, the amount on Line 13 will represent the amount that
carries forward to the next tax year assuming you haven't
hit the 10 year threshold.

--
Alan
http://taxtopics.net

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Larry Israel wrote:

- quote -

You cannot combine the credits on one 1116. However, the
carryover is good for 5 years so you should include two
1116s in this years return. The 1116 for the general
limitation income would show the carryover from 2003 but no
credit for the current year. This credit would then
carryober to 2006, etc.

Lanny K. Williams, CPA
Nawarat, Williams & Co., Ltd.
Income Tax Service for Expatriate Americans

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I realized that this was a dumb question, because when the
calculation is done you end up multiplying by zero to the
the credit, so there can be no credit.

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Last year I filled out Forms 1116 both for passive income
and general limitation income. This year I only have
passive income. I had taxes available for carryforward in
both categories. This year I only have passive income.

It seems to me that I can carry forward the passive income
excess tax from last year, but not the general limitation
tax. Or maybe I didn't read the instructions and
Publication 514 right, and I could/should fill in a Form
1116 for the general limitation income even though I did not
have any this year. Or maybe I can combine the two excesses
in one Form 1116 for passive income.

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