I pay more taxes on foreign income in Switzerland than I would pay in the United States. Is there any way that I can take the full tax credit for the foreign tax I pay this year? If not, is there any way I can work it to recover the foreign tax in the future?

ANSWER

The BIDaWIZ Team's Answer:

The short answer is that you cannot take the full credit for this year. However, if you have foreign taxes available for credit, but you cannot use them because of the foreign tax credit limit, you may be able to carry them back to the previous tax year and forward to the next 10 tax years (Reference IRS Publication 514 & IRC Section 904(c)). Thus, this means you need to apply the excess foreign taxes as back the preceding two years and forward the following 10 years. We've provided the excerpt below from the Internal Revenue Code.