Calculate the foreign tax credit limitation

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Problem - A corporation has $100,000 of U.S. source taxable income and $200,000 of foreign source taxable income from countries X and Y for a total worldwide taxable income of $300,000. Countries X and Y levy a total of $60,000 in foreign taxes upon the foreign source taxable income. U.S. taxes before credits are $120,000. Calculate the foreign tax credit limitation?

A) $35,000.

B) $60,000.

C) $80,000.

D) $120,000.

Reference no: EM132464773

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