Foreign Tax Deduction

Foreign Tax Deduction means:
a provision whereby individuals may deduct foreign income taxes paid or accrued, or may apply these taxes as a credit against U S. income tax owed (see also foreign tax credit). Former IRC (check if this IRC provision is current here) §164.

Relief from domestic tax on income from abroad which has already suffered foreign tax. Generally speaking, two approaches are taken to foreign tax relief, i.e. the credit method or the exemption method.

See the entries Income Tax and State Income Tax in the American Encyclopedia of Law.