Problem: For passive category, among $88,811 foreign tax paid for 2017, $59,259 was carried back to prior year. However, prior year carryback used (proforma) was greyed out, so amounts couldn’t be entered there. Thus, statement shows $92,698 as carryover amount to 2021, which is not correct. However, carryover amount to 2022 is correct as it includes carryback to prior year (see the second screenshot). 2020 was the first year we used GST, and we forgot to input foreign tax carryover in 2020 return. Please advise how to fix the statement (first screenshot) to show the correct carryover amount to 2021 ($33,439).
Solution:
The solution is to enter the ‘Carryover Total (Proforma Override)’ in the foreign tax credit carryovers tab. Unfortunately, the ‘prior year carryback used (proforma)’ is grayed out and cannot be used as it automatically computes based on prior year return data. There is a concern about this resolution as there is no explanation on how we get from $88,811 to $29,552 (first screenshot). The only columns available for this statement is ‘foreign tax credit used’ and ‘adjustment for refund.’ If the total cannot be overridden then you could use the other two column data entries to populate and naturally arrive at the $29,552 (second screenshot).
