A credit is allowed for foreign income taxes paid or accrued. The credit is limited compared to that part of U.S. tax due to foreign source income. It is far from refundable, but any excess credit the carried to other years to reduce tax. 2) Are you participating with your company's retirement plan? If not, not really try? Every dollar you contribute could decrease your taxable income minimizing your taxes to . So far, so sound. If a married couple's income is under $32,000 ($25,000 for ju...