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I was using Schedule A for the foreign tax in recent years because it didn't matter. There wasn't much activity in the investment accounts and we made some donations that kept our taxes at or near zero. 2017 was different and that's why I wanted to use 1116. And, yes, all tax was paid on dividends.

But after filling out form 1116, I end up with a little more in taxes than if I use Schedule A. Maybe I'm not doing it right. Form 1116 asks for all the income from the countries where foreign tax was paid. So I added up all the dividends, interest and capital gains from those countries and entered them on 1116. And that cut my foreign tax credit from $1149 (the actual amount of the foreign tax paid) down to $343. So it's better to take the deduction for the entire $1149.

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