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Testing, 1, 2, 3
OK, now I have a good connection.
You can only utilize the carryover in 2011 if you have foreign income in 2011. In that case, you fill out part I of the form, skip part II, put the carryover amount on line 10 of part III, and attach a statement supporting that line. If you have no prior carryovers, you report the something like:2010 form 1116 carryover: $ XXXless carryback to 2009: $ XX--------------------------------------------carryover available in 2011 $ YYY
Sorry, let me rephrase that, as I misread your question
You add an attachment looking something like table 6 on page 27 of the 2011 publication 514 instructions at http://www.irs.gov/pub/irs-prior/p514--2011.pdf .
If you have no foreign income in 2011, then you can continue carryforwards from 2002 and later to 2012.
I'm going to be offline for a few hours; if you need more assistance, and are willing to wait, please don't hesitate to ask. If that's not acceptable, you can opt me out.
If you are willing, I might be able to provide more specific answers if you can provide the numbers from lines 9 (current foreign tax paid), 10 (foreign tax carryover), 21 (maximum amount of credit), and 22 (actual amount of credit) for each year where you have filed form 1116.
I just want to clarify one point. If I don't pay any foreign tax in 2011, (thus there would be no entry on line 9) I can still use a foreign tax credit carryover as long as I have foreign income?
Yes, that's correct. The foreign income has to be subject to tax, (i.e., not treated as US income by treaty), but there doesn't have to be any actual tax.