Foreign Exclusion and Tax Credit (LO 7.6)
Martha and Lew are married taxpayers with $2,650 of foreign tax withholding from dividends in a mutual fund. They have enough foreign income from the mutual fund to claim the full $2,650 as a foreign tax credit. Their tax bracket is 15 percent and they itemize deductions.
Should they claim the foreign tax credit or a deduction for foreign taxes on their Schedule A?
If required, round your answer to the nearest dollar.
The foreign tax deduction will result in a $ \boxed{} tax benefit where as claiming the foreign tax credit yields a $ \boxed{} \times tax benefit.
Therefore, the taxpayers should claim the foreign tax credit.
