foreign tax credit(redirected from Foreign Tax Credits)
Foreign tax credit
Home country credit against domestic income tax. Received in return for foreign taxes paid on foreign derived earnings.
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Foreign Tax Credit
A direct, dollar-for-dollar reduction in one's U.S. tax liability because of taxes levied by a foreign government. The United States is one of the only countries that taxes income that citizens earn abroad. However, the foreign tax credit exempts income paid as taxes to foreign governments, eliminating the possibility of double taxation.
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foreign tax credit
The reduction in a U.S. tax liability because of taxes accrued or paid to a foreign government during the same taxable year.
Wall Street Words: An A to Z Guide to Investment Terms for Today's Investor by David L. Scott. Copyright © 2003 by Houghton Mifflin Company. Published by Houghton Mifflin Company. All rights reserved. All rights reserved.