What Foreign Taxes Qualify for the Credit?
Generally, the following four tests must be met for any foreign tax to qualify for the credit. • The tax must be imposed on you. • You must have paid or accrued the tax. • The tax must be the legal and actual foreign tax liability. • The tax must be an income tax (or a tax in lieu of an income tax). Certain foreign taxes do not qualify for the credit even if the four tests are met. See Foreign Taxes for Which You Cannot Take a Credit, later.
