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Page 2 of 4 Fileid: … 1116schb/202212/a/xml/cycle07/source 16:52 - 29-Dec-2022
The type and rule above prints on all proofs including departmental reproduction proofs. MUST be removed before printing.
amount that you entered on line 7, column (xiii), of the subtotal on line 4, column (vii); the $250 subtotal on line 4,
prior year Schedule B) and the actual carryback amount. column (viii); and the $250 total on line 4, column (xiv).
Example. For 2022, Sam has excess foreign taxes of The line 4, column (xiv), total can’t exceed the
$100 entered on Schedule B, line 6, column (xiii). Sam ! amount of the current year excess limitation.
enters $20 on line 7 as the estimated amount of line 6 to CAUTION
be carried back to 2021. He enters $80 on line 8 as the
carryover amount for following years. The actual Line 5. Foreign tax carryover expired unused in cur-
carryback amount to 2021 is later determined to be $15. rent tax year. Line 5 is completed only with respect to
In 2023, Sam enters $80 on line 1, column (xii), as the the 10th preceding tax year (and the “Subtotal” and
carryover from 2022, corresponding to the amount “Totals” columns). For the 10th preceding tax year
entered on line 8, column (xiii), of Schedule B filed for the (column (i)), combine lines 3 and 4 and enter the result on
2022 tax year. Because the estimated carryback amount line 5, column (i).
of $20 from 2022 to 2021 (entered on line 7 of Schedule B Line 6. Foreign tax carryover generated in current
filed for 2022) exceeds the actual carryback of $15, Sam tax year. With respect to a given separate limitation,
will enter the $5 excess ($20 − $15) on line 2a of his 2023 line 6 is completed only if you have current year excess
Schedule B as a positive number. Assuming no other foreign taxes (defined under Definitions, earlier). Enter in
adjustments are needed, the total carryover amount from column (xiii) (the current tax year column) the amount of
2022 entered on line 3, column (xii), of Sam’s 2023 your unused foreign tax for the current tax year (that is,
Schedule B will be $85 ($80 + $5). the amount by which the sum of Form 1116, Part III, lines
Line 2b. Adjustments for section 905(c) 9, 12, and 13, exceeds the amount on Form 1116, Part III,
redeterminations. Enter on line 2b any adjustments line 23). Also enter the same amount in the “Totals”
needed for section 905(c) redeterminations. See Foreign column (column (xiv)).
Tax Redeterminations in the Instructions for Form 1116
for additional information. Line 7. Actual or estimated amount of line 6 to be
Lines 2c, 2d, 2e, etc. Include on these additional lines carried back to the prior tax year. Enter the amount of
the following types of adjustments needed to reflect: line 6 carried back to the first preceding tax year. If, at the
• Domestic audit adjustments, and time you file your current year income tax return, the
• Any other adjustments needed to properly reflect the actual amount isn’t available, an estimated or tentative
total carryover amount from the prior tax year that is amount may be entered on line 7. If an estimated amount
available for credit in the current tax year. is entered on line 7 and this amount differs from the actual
carryback amount, the difference will be entered on
Note. Be sure to enter a brief description of each line 2a of your subsequent year Schedule B.
applicable adjustment item immediately after the lower
case letter in the first column of the schedule. Note. In order to carry back amounts to the first
preceding tax year, that first preceding tax year must be
Line 3. Adjusted foreign tax carryover from prior tax an excess limitation year (as defined earlier under
year. Combine lines 1 and 2. The total amount on line 3, Definitions).
column (xiv), is the adjusted carryover amount from the
prior tax year. It is included on Form 1116, Part III, line 10 Note. When this line 7 carryback amount is subtracted
(and, if filing an amended return, combined with from line 6, the difference is the amount of the foreign tax
carrybacks into the current tax year) to determine the total carryover generated in the current tax year which will be
amount of foreign taxes that are available for credit in the carried forward to your subsequent tax year.
current tax year.
Line 1 Reconciliation Worksheet
Line 4. Foreign tax carryover used in current tax If you're amending your 2021 foreign tax credit within the
year. With respect to a given separate limitation, line 4 is special 10-year limitation period described in section
completed only if you have a current year excess 6511(d)(3) (or section 6511(c) if the period is extended by
limitation (defined earlier).
agreement), use the worksheet at the end of the
Enter in each column the foreign tax carryover utilized instructions to figure the amounts to be entered on line 1
in the current tax year. Starting with column (i), the amount of your Schedule B for 2021.
to be entered on line 4 of a given column will be the
amount on line 3 of that column, but only to the extent that Lines 2 through 5. Use the instructions for lines 4
it doesn’t exceed: through 7 of Schedule B earlier to complete lines 2
• The amount of the current year excess limitation through 5, respectively, of the Line 1 Reconciliation
(defined earlier), less Worksheet.
• The sum of all amounts entered in all previous columns Additional Information
of line 4.
For more information, see section 904(c) and Regulations
Example. For the current tax year, Bob has an excess section 1.904-2.
limitation of $250. The amount on line 3, column (i), is
$80. The amount on line 3, column (ii), is $60. The amount
on line 3, column (iii), is $130. The amount on line 3 of all Paperwork Reduction Act Notice.
subsequent columns is irrelevant for purposes of this We ask for the information on Schedule B to carry out the
example. Bob enters $80 on line 4, column (i); $60 on Internal Revenue laws of the United States. You're
line 4, column (ii); $110 on line 4, column (iii); the $250 required to give us the information. We need it to ensure
-2- Instructions for Schedule B (Form 1116) (Rev. 12-2022)
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