My foreign tax was refunded after I already claimed the credit. Do I just adjust this year's Form 1116, or do I need to amend prior years too?
I live in Canada and in 2026 I received a partial refund of Canadian tax that I had previously claimed as a foreign tax credit on my U.S. return. The refund relates mostly to my 2024 U.S. tax year. I initially assumed I would just net the change into the current year, but my preparer says foreign tax redetermination rules can force prior-year corrections.
I need to know whether this is one of those cases where Schedule C goes on the current return and a Form 1040-X also has to be filed for the older year. If so, I want to understand the logic before we start rebuilding the file.
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