A US Citizen Accrued $120,000 of Creditable Foreign Taxes Last Year

question 45

Multiple Choice

A U.S. citizen accrued $120,000 of creditable foreign taxes last year. The citizen's foreign tax credit limitation for last year is $90,000 (only a single limitation need be calculated) . The excess foreign tax credit limitation for the year preceding the year in which the excess foreign taxes were incurred is $2,000. A similar $2,000 excess foreign tax credit limitation position is expected in each of the next 10 years. What portion of the excess foreign taxes can be expected to be noncreditable because of the foreign tax credit limitation?

• A)$0
• B)$2,000
• C)$8,000
• D)none of the above

---

Definitions:

SUTA Tax

SUTA Tax, or State Unemployment Tax Authority Tax, is a state tax that employers pay to fund their state's unemployment insurance program.