A credit is allowed for foreign income taxes paid or accrued. The loan is limited compared to that part of You.S. tax due to foreign source income. It isn't refundable, but any excess credit the carried to other years to reduce tax. Some plans ready still make do with it, it's just that since you get caught avoiding the filing of the irs Form 2290, you could be charged some.5% of the owed amount, likewise just filing past the deadline often means paying 9.5 percent of the balance in late fees...