Election not to file a 1116

[John of PA]

This may be a silly question, but the election not to file a 1116 when taking the credit (FTC) for foreign taxes withheld from dividends does not require an election statement. So how do you make the election? Just by deducting the credit?

[FEDUKE404]

Not a valid election

It's always been my understanding no such "choice" was available, to include someone who exceeds the $300/$600 limits.

Read carefully the center column of page 1:

http://www.irs.gov/pub/irs-pdf/i1116.pdf

Especially "only if you meet ALL of the following conditions"

FE

[John of PA]

Thank you Duke. I am refering to when the credit is less than 300. The last paragraph of the instruction link you gave above does say you make the election simply by entering the credit on the approppiate 1040 line, so that answered my question, Thank You. I am switching from Lacerte to Drake, I was confused becasue Lacerte's F1 help (Lacerte is somewhat superior to Drake) sais you don't have to attach the election statement, but Lacerte give you the option to attach it if you wish. Drake does not even give a choce, they just don't attach it.

[FEDUKE404]

Additional

Thank you Duke. I am refering to when the credit is less than 300. The last paragraph of the instruction link you gave above does say you make the election simply by entering the credit on the approppiate 1040 line, so that answered my question, Thank You. I am switching from Lacerte to Drake, I was confused becasue Lacerte's F1 help (Lacerte is somewhat superior to Drake) sais you don't have to attach the election statement, but Lacerte give you the option to attach it if you wish. Drake does not even give a choce, they just don't attach it.

I'm not familiar with an "election statement."

Do you think perhaps you are just dealing with a software issue, i.e. asking/certifying/whatever that the owner of the tax return wishes to use a Form 1116 credit versus the (perhaps) simpler route of an itemized deduction on Schedule A for the "same" foreign tax? There can obviously be return-specific issues for preferring Plan A or Plan B.

FE

[Will]

Drake does not even give a choce, they just don't attach it.

And rightly so, since you don't need it.

[John of PA]

The choice to take the foreign taxes paid as an itemized deduction rather than a credit is a totally separate issue. As regard to taking the credit but electing not to file the 1116, one apparently does not have to attach an election statement, but they can if they wish.