Refundable Child Tax Credit for Overseas FTC Filer

Forum|Forum|3 days ago
July 14, 2026
2 replies
37 views

I have a self-employed overseas client who is filing with his Foreign Tax Credit (not the 2555, which doesn’t allow the refundable CTC) so he should be entitled to the refundable portion of the child tax credit.

When I exclude the Self employment tax on Form SE (due to Totalization Certificate of Coverage I am attaching) it wipes out the refundable Child Tax Credit refund. He only has $70k income, so is well below the threshold. How do I get it to allow the refundable tax credit without a manual override, which would necessitate a paper file and possibly a review? Prior tax preparers for the last several years have gotten him this refund but ProSeries is not allowing it.

Is there anything I can do to restore the refund?

Thanks for any advice!

ProSeries Professional

BobKamman

Level 15

Were the previous returns excluding all the SE income, or leaving enough on Schedule SE to cover the minimum required? I’m not sure that’s allowed, but I doubt anyone at IRS is looking for it.

R

rcherensonAuthor

Level 5

No they didn’t exclude the SE Income on the SE Schedule, they seem to have done some really hinky thing and created a second column on the 1116 with additional invented income with additional invented Swedish tax withheld that brought the FTC to EXACTLY the tax due, to make it zero. They must have done a plug and play to get it to that. I tried to explain to client, but he didn’t seem to understand nor care. He just wants that child tax refund.

T

TaxGuyBill

Level 15

I would override line 2b of the Earned Income Worksheet.

It may let you e-file without doing anything special, but you can also disable error-checking when e-filing to let it go through.

R

rcherensonAuthor

Level 5

Hmm, yes that looks like it would work. It now shows the self-employment income as other income, tax is zero and the net result is a $3,400 CTC refund.

I don’t know if it will let me e-file with or without turning off error checking , but it does seem to be a good workaround IF it goes through (and is accepted by the IRS).

Thanks!

T

TaxGuyBill

Level 15

Turning off error-checking will definitely allow the e-file with no problems.

Were the previous returns excluding all the SE income, or leaving enough on Schedule SE to cover the minimum required? I’m not sure that’s allowed, but I doubt anyone at IRS is looking for it.

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