Foreign Tax Credit on Canadian return

tigerjk · Post by **tigerjk** » Mon Mar 07, 2016 4:06 pm

Hi,

Which US taxes of the 4 below can I claim as a Foreign Tax Credit on the Canadian T1 return?

Federal, State, Social Security, Medicare

Do I total the withheld tax total or the actual tax paid (after exemptions and refunds)? I'm assuming actual tax paid but wanted to be certain.

Thanks in advance.

nelsona · Post by **nelsona** » Mon Mar 07, 2016 5:00 pm

All those. tax determined on your fed and state returns.

optism · Post by **optism** » Thu Mar 10, 2016 6:15 pm

Just so I'm clear, in this case one would report actual tax paid and not total tax withheld?

agrisiva · Post by **agrisiva** » Thu Mar 10, 2016 6:21 pm

Yes, you report the Actual taxes. Not the withholdings, refunds, or due amounts on filing.

nelsona · Post by **nelsona** » Fri Mar 11, 2016 6:41 am

The correct tem is ACCRUED taxes. The taxes determined on your tax returns.

optism · Post by **optism** » Fri Mar 11, 2016 10:29 am

So for example, line 39 of the 1040A: [b]"39 Add lines 37 and line 38. This is your total tax."[/b] ?

nelsona · Post by **nelsona** » Fri Mar 11, 2016 11:09 am

Sure. Assuming you don't have any of the credits listed on line 42 thru 45.

get used to use 1040, not 1040A.

And if this is your first 1040, then be sure you are reporting WORLD income, not just US income, if you moved mid-year.

optism · Post by **optism** » Fri Mar 11, 2016 11:20 am

Right, I need the 1040 to claim foreign tax credits. Thanks for the reminder.

Just to clarify, I only report world income earned while in the U.S., correct? Any Canadian income earned while still living in Canada (Jan-April 2015) would not be included on the 1040?

nelsona · Post by **nelsona** » Fri Mar 11, 2016 11:22 am

No, you report ALL WORLD INCOME, for ENTIRE YEAR if you use 1040.

And you won't know your foreign tax until you iron out the 217 and the underpayment of your RRSP.