Internal Revenue Service United States Department of the Treasury
Level Basic Advanced Military International

Foreign Tax Credit Workout

Types of Income

Skills Warm Up: General vs. Passive Income

Tax Your Memory

Match each term with its corresponding example by typing in the number of the term in the blank next to the example. Assume the taxpayer is a U.S. citizen or resident living in a foreign country, and that the income was earned in a foreign country.

Terms Examples
1. Passive category income Match Income from rental properties in Italy
2. General category income Taxes paid on earnings to the French government when the foreign earned income exclusion is not claimed
  A German bank withholds a mandatory 32.5% of interest income as income tax
  Interest income subject to a 45% income tax in England