Ypsi Corporation Has a Precredit U

Essay

Ypsi Corporation has a precredit U.S. tax of $780,000 on $2,000,000 of taxable income in 2014. Ypsi has $400,000 of foreign source taxable income characterized as general category income and $150,000 of foreign source taxable income characterized as passive category income. Ypsi paid $180,000 of foreign income taxes on the general category income and $30,000 of foreign income taxes on the passive category income. What amount of foreign tax credit (FTC) can Ypsi use on its 2014 U.S. tax return and what is the amount of the FTC carryforward, if any?