Our adviser says foreign taxes in the section 951A basket do not carry over. Is that actually different from normal Form 1116 carryovers?
I am a U.S. shareholder in a foreign operating company, and this year our international package includes foreign taxes connected to section 951A category income. I am used to hearing that unused foreign tax credits can carry back and forward, so the idea that this category does not get the same treatment caught me off guard.
Before I sign off on the return, I want to know whether this is an actual statutory limitation reflected in IRS guidance or just a conservative preparation choice. If 951A category taxes truly cannot generate carryovers, that changes how I think about excess credits in this basket.
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