This year, I’m going to owe x$ to the US and x$ to Japan for capital gains that were remitted to Japan. For the purposes of convenience, let’s assume nothing was withheld, and I can’t the Japanese FTC for any of this.
Since I’m paying these taxes in the year 2024, I can’t currently claim the FTC on my US taxes, as I haven’t actually paid them yet. Instead, I first will apply them to my 2024 US taxes, and then if there’s any left over, I will apply them to my 2023 US taxes via an amended return.
Similarly, when filing my 2024 taxes, I can’t yet apply the taxes that will be due in 2025, so those will get carried back to 2024. And this will continue indefinitely, meaning each year I’m filing both a current-year return and a previous year amendment.
Is this accurate? It’s annoying, but I guess it’s how things go.
by Naomi_Tokyo