You are required to increase or decrease your taxable income or (loss) from sources outside the United States by the following adjustments. The adjustments must be made in the order listed. If you have more than one adjustment, enter the net adjustment on line 16 and attach a detailed statement showing your computation.
What adjustments should I take into consideration?
The adjustments are:
- Allocation of foreign losses.
- Allocation of U.S. losses.
- Recapture of prior year overall foreign loss accounts.
- Recapture of separate limitation loss accounts.
- Recapture of overall domestic loss accounts.
- Adjustment for disallowed business loss under section 461(l).
- See Pub. 514 for more details on each of these adjustments.
- Form 1116 Instructions