Dividends and Distributions: What if the mutual fund I own invested in foreign securities?

If you own a mutual fund that invested in foreign securities, the mutual fund may have paid taxes to a foreign country as a result of owning those securities.  Form 1099-DIV reports the gross amount of the dividend and the amount of foreign tax. Refer to IRS Publication 514, Foreign Tax Credit for Individuals and the instructions for Form 1040, Schedule A (Itemized Deductions) and Form 1116, Foreign Tax Credit.   

In compliance with Treasury Department Circular 230, unless stated to the contrary, any information contained in this FAQ was not intended or written to be used and cannot be used for the purpose of avoiding tax penalties that may be imposed on any taxpayer.