# Use the Foreign Tax Credit to Prevent Double Taxation



## MyExpatTaxes (10 mo ago)

To prevent double taxation, Americans in Australia can use the Foreign Tax Credit. Whatever amount of taxes owed you paid in Australia can be applied to your US tax return, so you won’t have to pay taxes twice. 

Let’s say you have $3,000 of US tax owed on your US Tax Return but paid AUD 4,000 worth of tax in Australia. You can use income tax on Australia to net against what the US is taxing. 

$3,000 of US taxes owed (minus) – $3,000 of a foreign tax credit of foreign income taxes paid to Australia. This will give you a $0 tax amount owed and allows you to claim the Additional Child Tax Credit if you’re children quality (see Child Tax Credit section above for qualification details).


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