What are the primary tax implications of investing in foreign securities or owning mutual funds that invest in foreign securities?
Dividends and interest earned on foreign securities may be subject to withholding tax by the country from which they were paid. If you held securities that paid dividends or interest that was subject to foreign tax, the Dividends and Distributions section and the Interest Income section report the gross amount of the dividends or interest (as applicable) and the amount of tax withheld at the source. You may be able to claim a credit or deduction on your federal tax return for the amount of tax paid to foreign countries. If you own a mutual fund that invests in foreign securities, the mutual fund may have paid taxes to foreign countries in respect of those securities. As a shareholder of that mutual fund, you may be able to claim a credit or a deduction on your federal tax return for a portion of those foreign taxes.
Dividends and interest earned on foreign securities may be subject to withholding tax by the country from which they were paid. If you held securities that paid dividends or interest that was subject to foreign tax, Form 1099–DIV and Form 1099–INT report the gross amount of the dividends or interest (as applicable) and the amount of tax withheld at the source. You must report the gross amount of the dividend or interest on your tax return; however, you may also be able to claim a credit or deduction for the amount of tax paid to foreign countries. If you own a mutual fund that invests in foreign securities, the mutual fund may have paid taxes to foreign countries in respect of those securities. As a shareholder of that mutual fund, you may be able to claim a credit or a deduction on your federal tax return for a portion of those foreign taxes. Form 1099–DIV reports the gross amount of the dividend (line 1a), including the foreign tax amount, and the amount of Foreign tax (if any) that
Related Questions
- What are the primary tax implications of investing in foreign securities or owning mutual funds that invest in foreign securities?
- What are the primary tax implications of owning a mutual fund that invests in foreign securities?
- What are the primary tax implications of owning mutual funds that invest in foreign securities?
