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    progtick's Avatar
    progtick Posts: 12, Reputation: 1
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    #1

    Oct 4, 2011, 09:40 AM
    Getting foreign tax credit - DTAA
    If I am claiming credit for tax paid to the foreign country, how would I convert the currency to USD? What date should I use to look up the forex rate?
    AtlantaTaxExpert's Avatar
    AtlantaTaxExpert Posts: 21,836, Reputation: 846
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    #2

    Oct 4, 2011, 02:31 PM
    You have several choices. You can:

    1) Pick the date the exchange actually happened, i.e. the date the taxes were paid.

    2) Pick the AVERAGE exchange rate for the year. You can get the IRS official average from www.irs.gov.

    3) Pick the MEDIAN exchange rate (July 1st).

    You just need to be consistent in your choice.
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